SaxoTV

Beecroft: Why I've bought puts on short sterling

376 views
August 13, 2014 UK, UK RATES, bank, bank of england, boe, boe split, britain, britain outlook, carney, dovish, employment, england, finance, forecast, gbp, gbpusd, gdp, gdp upgrade, growth, growth uk, inflation, inflation report, interest rates, mark carney, mccafferty, metrics, monetary policy, money, mpc, news, nick beecroft, of, pound, puts, qir, rate rise, rate rise 2015, record, saxo, saxo bank, saxo capital markets, saxo tv, short, split, sterling, sterling dollar, sterling puts, this year, tradingfloor.com, uk carney, uk data, uk economics, uk economy, uk inflation, uk inflation report, uk jobs, unemployment, united kingdom, usd, wage growth, wages, weak wage growth, weale
"I still think we'll see a UK rate rise by Christmas", the words of Nick Beecroft, the Chairman of Saxo Capital Markets.  He was speaking after the Bank of England Governor, Mark Carney,  revealed it had halved its wage growth forecast for the UK while upping the country's GDP outlook to 3.5%. Separate figures out this Wednesday showed that unemployment in Britain had fallen to a near six year low.
Nick reveals he's bought puts on short sterling that expire in September because there's a tiny chance we could see a rate rise then, although he stresses it's more likely to happen in October or November. GBPUSD fell this Wednesday, largely says Nick, because Carney was more dovish than most people expected.
Nick speculates there could soon be a split in the Bank of England's Monetary Policy Committee about when next to raise rates. All depends, he says, on wage growth data which is becoming the "most important metric in town."