BOE’s Haldane says rate hike would be prudent

Sterling is little changed against the euro at just over 88p notwithstanding comments by the Bank of England’s Chief Economist, Andrew Haldane, that an increase in UK interest rates would be ‘prudent…relatively soon’. This leaves him siding with the three other BOE members who voted for an immediate 25bps hike at last week’s meeting (he held off voting for an increase because of election uncertainty), but leaves him on the opposite side to his boss, Mark Carney, who on Tuesday said that now is not the time to raise interest rates

The euro continues to trade in a relatively narrow range against the dollar and is sitting just above $1.1150 this morning (the range for EUR/$ this week has been about $1.1120 to $1.1220)

Bond yields in the UK jumped yesterday following Haldane’s comments on interest rates – by around 8bps in the case of 2-year yields – but yields in US and Germany were little changed

Oil prices remain under a good deal of pressure with Brent sliding by more than a dollar to around $44.5 per barrel, some 22% down from its highs earlier this year

Fed member Harker is the latest to suggest that the central bank may pause for a number of months before raising interest rates again, with the next move perhaps likely to come towards the back end of this year

Yet another quiet day on the data front with jobless claims in the US the main release