Citi revises slightly BOE forecast, sees £75 billion QE boost this week

No negative rates expected yet

The firm now expects the BOE to increase QE by £75 billion as opposed to its previous call of a £50 billion increase, saying that the new package should run until May 2021.

Adding to that, the firm sees a higher change of a £10 billion expansion in corporate bond purchases and a rate cut of 5-10 bps but insists that is not the base case for now with more action being possible, depending on Brexit.

"Negative rates are still unlikely for now, but remain our base case for mid-2021 as the recovery disappoints."

Ahead of the Thursday decision, Deustche also revises its BOE forecast and now sees QE boosted by £100 billion instead.