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Morgan Stanley view following the MPC

BOE

Continues to see "modest roll over" in Nov ahead of full programme in Feb

  • Morgan Stanley continues to think "further easing is likely to follow the budget and Brexit resolution." However, it notes that "As these might only come after the November MPC, we now expect just a modest roll-forward of APF purchases then, given a still fragile outlook, with a later shift, perhaps in February, to the full package. In the end, though, we expect another £100 billion of APF purchases, allowing the programme to run through 2021, and a rate cut to ZIRP."
  • "Our forecast assumes a close FTA with the EU, similar to the BoE's projections, while an adverse Brexit outcome would see the MPC taking rates negative, we think."

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