Talk on Interest Rate

The Bank of Japan is scheduled to announce its next interest rate decision towards the end of next week, where many feel rate-setters will opt for a further quarter point rate rise which may help the yen to recover after reaching 13-month lows against the dollar yesterday. Speculation is now intensifying that the BoE will deliver a further hike in the coming months, possibly as soon as next month.
With the hawks so clearly in the ascendancy, and the Bank in a pre-emptive mood, these factors mean another rate hike is likely to be delivered during the second quarter. The BoE's rate hike contrasted with the European Central Bank's decision to leave euro zone rates on hold and comments by ECB president Jean-Claude Trichet suggesting that euro zone interest rates will rise in March rather than February, which allowed the pound to break out of its recent trading range against the euro.