(18 JUNE 2020)DAILY MARKET BRIEF 2:BoE to announce more asset purchases

<p>In the respect, the Bank of England (BoE) is expected to maintain the benchmark rate unchanged at the historical low of 0.10% and to expand its asset purchases program by at least 100/150-billion pound at today’s monetary policy meeting. With plummeting inflation, rising unemployment and lingering risks of a no-deal Brexit, the bank has room and solid reasons to move towards a more unorthodox policy. While the BoE’s near zero rates and massive asset purchases should push the consumer prices higher in the long run, the inflation will probably not be a cause for concern in the foreseeable future. Given the expectation of QE expansion is fully priced in, the BoE announcement per se may not move the market significantly unless we see a meaningfully different outcome from the BoE meeting or a hint for more policy easing in the foreseeable future. Cable is flat near the 1.2550 mark, supported by a mostly flat US dollar across the board. A supportive BoE stance will certainly be perceived as</p>