UK MPC Meeting Minutes will be the first time for the market to get a glimpse of what took place during the MPC meeting two weeks ago. Today’s minutes could further add to the weakness in Sterling if the two dissenters were to change their minds; or if we have more than two dissenters, market could take that as a bullish sign…
4:30am NY Time UK MPC Minutes Rate Forecast 2-0-7 Previous 2-0-97
4:30am NY Time APT Forecast 0-0-9 Previous 0-0-9
DEVIATION: 2 Votes (BUY GBP on 2 votes of rate hike / SELL GBP on 2 votes of APT Increase)
The Trade Plan
We will be looking at the vote count today and I’d recommend to sit on the sideline or follow me in the traderoom to trade this release. Due to the nature of this release, you need to have a newswire or audio service in order to trade it. If we see a steady market reaction after the release, it may very well carry over to the NY Session, therefore I’d wait for 5 minutes before even deciding on a trade. If market moves steadily, then I will use the double-fibonacci method and follow that trend.
I’d recommend to use the Recommended Pairs from above as they are based on my CSM, which should provide the best combination of currency pairs to trade based on better/worse news… of course, you can also trade the default pair: GBPUSD.
Outlook Score
Outlook score is derived from market sentiment, focus, and economic indicators for the currency. It represents the long-term trend of the currency and its market perception. In short, a strong Outlook Score means more long-term demand for the currency, and a weak Outlook Score is the opposite.
Definition
The MPC meets every month to set the interest rate. Throughout the month, the MPC receives extensive briefing on the economy from Bank of England staff. This includes a half-day meeting known as the pre-MPC meeting which usually takes place on the Friday before the MPC’s interest rate setting meeting. The nine members of the Committee are made aware of all the latest data on the economy and hear explanations of recent trends and analysis of relevant issues. The Committee is also told about business conditions around the UK from the Bank’s Agents. The Agents’ role is to talk directly to business to gain intelligence and insight into current and future economic developments and prospects.
The monthly MPC meeting itself is a two-day affair. On the first day, the meeting starts with an update on the most recent economic data. A series of issues is then identified for discussion. On the following day, a summary of the previous day’s discussion is provided and the MPC members individually explain their views on what policy should be. The Governor then puts to the meeting the policy which he believes will command a majority and members of the MPC vote. Any member in a minority is asked to say what level of interest rates he or she would have preferred, and this is recorded in the minutes of the meeting. The interest rate decision is announced at 12 noon on the second day.