Weale joined Sentance in calling for 25 bps rate hike. Cable trips stops through 1.5840 and spikes to 1.5864 before retreating again. Presently at 1.5830.

  • Voted 8-1 to keep total QE at 200 bln, Posen as usual voted for additional 50 bln
  • MPC considered case for rate rise in January, most members saw rise in medium-term CPI risks
  • For some MPC January rate decision was finely balanced, February inflation report will help assess CPI risks
  • Some MPC said January rate rise could be misinterpreted as signal MPC could raise rates rapidly, hurt economy
  • Probable near-term CPI path will be “materially higher” than forecast in November inflation report
  • Upside risks to CPI from commodity prices, imported inflation, rise in prices of domestic import substitutes
  • Downside risks to CPI from govt spending cuts, euro zone debt crisis. tight credit conditions
  • MPC saw little change in risks to growth since December meeting, growth likely in line with trend despite snow and VAT

Boy, don’t envy the chaps at the MPC. Quite a puzzle. If in doubt, my advice do nothing.