Forex Flash: What to expect from the UK Budget and BoE minutes – TD Securities

FXstreet.com (Barcelona) - Today’s MPC minutes will tell us how the BoE decision went, with TD Securities analysts betting it was another close call as data was mostly on the weak side heading into the meeting. “We think that we’ll see a 6-3 or possibly even 5-4 vote, with Governor King continuing to favor further QE”, wrote analyst Alvin Pontoh, adding that gilts might rally with suggestions that members would have considered voting for an extension if it wasn’t for the reinvestment from the matured 4H13.

In regard to the 2013-2014 Budget, TD Securities broke it into three categories: “1) Any changes to the BoE mandate—we wouldn’t expect anything concrete to be announced today but would expect some kind of statement that the mandate is to be examined. 2) Enhancements to FLS—shouldn’t be particularly market moving. 3) Any further growth supportive policies—these are fairly light on the ground and are likely to include increases to the personal allowance, reductions in corporation taxes, bringing forward the flat rate pension by a year and increased childcare support—most have been leaked to the press already so shouldn’t have too much market impact”, wrote Pontoh, also expecting falling jobless claims in the UK by another 10-15K in Feb (more than consensus).