March 22, 2023 07:07 GMT
Services inflation strong; MNI Markets team looks for 25bp from BOE tomorrow
- Services inflation increased from 5.2%Y/Y to 5.6%Y/Y (CPIH services).
- As we noted in our BOE Preview, we thought that to see an on hold decision tomorrow we needed to see a further deceleration in services inflation, and in today's data we have seen a reversal of the decline seen in January's data.
- The MNI Markets team therefore looks for a 25bp hike from the BOE tomorrow on the back of this data.
- "The largest upward contributions to the monthly change in both the CPIH and CPI rates came from restaurants and cafes, food, and clothing, partially offset by downward contributions from recreational and cultural goods and services (particularly recording media), and motor fuels." ONS
- GBPUSD jumps from 1.2234 to 1.2264 but is now at 1.2250 at writing.