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3rd May 2022 18:00U.K., Daily Monitor

Sterling fell by 2% on a trade-weighted basis in April; investors are increasingly betting on a further fall.

The MPC can't be indifferent to sterling; depreciations impart a large and long-lasting boost to inflation.

But sterling's recent insensitivity to changes in rate expectations implies it can hike Bank Rate "modestly".

brexit cpi cpi inflation depreciation ECB euro fed headline rate interest rates June mpc October policy sterling u.s.

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Keywords for: Will Sterling Derail the MPC's Plans for "Modest" Tightening?

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