LIVE MARKETS-Here comes the BoE...

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HERE COMES THE BOE...

Markets and economists widely expect the Bank of England to lower its key Bank Rate by 25 basis points to 4.5% when it announces policy at midday, but focus will likely to turn to the vote split and future path for rates.

Barclays believes a 7-2 vote in favour of a quarter-point is likely but think Chief Economist Huw Pill or Meg Greene could vote for a hold alongside Catherine Mann, so an 8-1 or 6-3 vote is possible.

Looking forward, Barclays doesn't see the BoE providing clarity on the outlook.

"We do not expect any signal of sequential cuts to be given at this meeting," Barclays says.

"However, we continue to expect this shift to happen later in the year given the implied undershoot of medium-term inflation in the MPC's forecast and our own view that output growth in the coming months will be more muted and labour market deterioration more pronounced."

Uncertainty is the biggest issue. Possible tariffs from the U.S. linger in the background, while March's fiscal event and the previously announced National Insurance changes in April could affect the BoE's outlook.

But by the June meeting, once that uncertainty has cleared, Barclays believes the BoE could cut rates at a faster rate.

"We think uncertainty will have diminished sufficiently for the MPC to be confident in cutting rates sequentially, to 3.5% by September 2025," they add.

(Samuel Indyk)

EARLIER ON LIVE MARKETS:

GERMAN FISCAL EASING SCENARIOS: MODEST LIFT OR BOOST? CLICK HERE

JAPAN: SMALL (AND MEDIUM) IS BEAUTIFUL CLICK HERE

BUY EUROPE: STOXX, FTSE SCALE NEW PEAKS CLICK HERE

BEFORE THE BELL: MIXED BANK EARNINGS, BOE AWAITED CLICK HERE

FOCUS SWINGS BACK TO RATE MOVES, COMPANY EARNINGS CLICK HERE