Goldman Sachs Looking For Updated Forecast From BanRep Technical Staff

Goldman Sachs on BanRep Minutes Due Later Today:

• GS expect the minutes to show concern with the recent inflation dynamics and the overall balance of risks, including the further deterioration of short- and medium- term inflation expectations.
• In the meeting statement, the MPC did not provide an updated forecast for inflation. In the minutes, GS will be looking for an updated forecast by the central bank’s technical staff which in its latest forecast expected inflation to print at 4.3% by the end of 2022 (4.5% for core).
• In the context of the split vote, GS expect the minutes to review the debate among board members on the set of conditions that prompted the central bank to prefer a more moderate monetary policy normalization path amidst a notably complex inflation backdrop.
• The MPC also highlighted that it expects the negative output gap to close faster than it had previously anticipated and upgraded its forecast for real GDP growth for 2022 to 4.7% from the prior 4.3%.