Free Trial

UK CPI Data Due at 7:00BST

UK DATA
  • The MNI Markets team thinks that Wednesday's CPI print will be the most important single indicator determining whether the BOE cuts rates in June or remains on hold (likely until August).
  • April CPI is particularly important for the UK as it marks the beginning of the new financial year and a number of services prices see their annual price increases.
  • Last year both the Bank of England's forecast and the analyst consensus were surprised at how high services inflation was in April 2023’s print.
  • The Bank of England looks for services CPI at 5.52%Y/Y while the analyst median expectation from the previews we have read is a bit softer at 5.47%Y/Y, down from 6.0%Y/Y in March. The Bloomberg consensus for services CPI is a little softer at 5.4%Y/Y.
  • We think if the data is broadly in line with expectations, the probability of a cut will increase (and this will also impact the probability of further cuts down the curve). With markets still pricing just under a 50/50 chance of a June first cut, we would expect to see a decent market reaction to either a higher or lower-than-expected services CPI print.
For the full MNI CPI Preview click here.
195 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
  • The MNI Markets team thinks that Wednesday's CPI print will be the most important single indicator determining whether the BOE cuts rates in June or remains on hold (likely until August).
  • April CPI is particularly important for the UK as it marks the beginning of the new financial year and a number of services prices see their annual price increases.
  • Last year both the Bank of England's forecast and the analyst consensus were surprised at how high services inflation was in April 2023’s print.
  • The Bank of England looks for services CPI at 5.52%Y/Y while the analyst median expectation from the previews we have read is a bit softer at 5.47%Y/Y, down from 6.0%Y/Y in March. The Bloomberg consensus for services CPI is a little softer at 5.4%Y/Y.
  • We think if the data is broadly in line with expectations, the probability of a cut will increase (and this will also impact the probability of further cuts down the curve). With markets still pricing just under a 50/50 chance of a June first cut, we would expect to see a decent market reaction to either a higher or lower-than-expected services CPI print.
For the full MNI CPI Preview click here.