19 Jul 2013
Flash: BoE to continue to create ‘froth’ – BMO
FXstreet.com (London) - Stephen Gallo, European Head of FX Strategy commented on the recent stance from the BoE.
Key Quotes:
“We remain of the view that the BoE will do everything in its power to maintain a moderate degree of ‘froth’ within the interest-rate sensitive sectors of the economy for as long as it can without driving things “too far””.
“But rather than buy GBP aggressively on “hot” or much better-than-expected data, we think the better bet would be to position for GBP topside on a 1-2 month basis on bets that BoE rhetoric may at times shift to more hawkish surprisingly quickly, despite the tone of the July statement”.
Key Quotes:
“We remain of the view that the BoE will do everything in its power to maintain a moderate degree of ‘froth’ within the interest-rate sensitive sectors of the economy for as long as it can without driving things “too far””.
“But rather than buy GBP aggressively on “hot” or much better-than-expected data, we think the better bet would be to position for GBP topside on a 1-2 month basis on bets that BoE rhetoric may at times shift to more hawkish surprisingly quickly, despite the tone of the July statement”.