There were few surprises yesterday as the expected 25bps hike and conditional future rate path were in line with expectations — that is for one further rate hike by end-2018. However, the Monetary Policy Committee (MPC) forecasts are based on an orderly Brexit and upturn in wage growth, and there is little current evidence that either will occur. Finally, the MPC painted a gloomy picture of the UK’s growth potential, putting it at about 1.5% in the medium term – much lower than the 2% OBR estimate. This is due to perennially weak productivity growth which, in our view, will only be exacerbated by Brexit.
Davy research
Davy ResearchIAG - Updated long-term goals at Capital Markets Day
Davy ResearchAmadeus IT Group - Solid quarter with in-line EBITDA; Premier Inn a new customer for Hospitality IT
Davy ResearchTotal Produce - Acquisition of 50% stake in The Fresh Connection, LLC
Davy ResearchAir France KLM - Strong Q3 results: unit revenue backdrop continues to improve
Davy ResearchMarket comment - First rate rise in a decade but gloomy outlook for UK growth
Davy ResearchLafargeHolcim - A pivot to growth – but first a 4% EBITDA downgrade
Davy ResearchIFG Group - A beneficiary of the UK rate rise