All eyes are on the Bank of England’s interest rate decision and quarterly monetary policy report on Thursday. Despite speculation about further cuts – into negative territory – forecasters say rate-setters will keep their powder dry until September. While Andy Haldane, the Bank’s chief economist, struck an upbeat tone with his “so far, so V” comments, more recently monetary policy committee members have emphasised the downside risks to the economy, such as a spike in unemployment when the furlough scheme ends and negative effects from social distancing.
Expect reassurances that the Bank is ready to inject further stimulus when necessary, even if it stays in “wait and see” mode for now.
Wednesday’s purchasing managers’ indices for global services are likely to show the sector continuing to recover as restrictions ease. Economists at Nomura note Friday’s US non-farm payrolls could reveal a smaller increase in jobs added due to the recent rise in virus cases.