{"id":2621,"date":"2008-08-04T10:47:38","date_gmt":"2008-08-04T10:47:38","guid":{"rendered":"https:\/\/mmm.9dotdigital.ca\/?p=2621"},"modified":"2025-03-27T15:48:40","modified_gmt":"2025-03-27T15:48:40","slug":"mpc-ometer-dovish-adjusted-m4-slows-further","status":"publish","type":"post","link":"https:\/\/mmm.9dotdigital.ca\/?p=2621","title":{"rendered":"MPC-ometer dovish; adjusted M4 slows further"},"content":{"rendered":"<p><P>My MPC-ometer suggests several MPC members will join David Blanchflower in seeking a cut in rates this month but will be outvoted by a slim majority in favour of no change. <\/P><br \/>\n<P>The model results are consistent with either 5-4 (four votes for a 25 bp cut) or 6-3 (two votes for 25 bp with DB seeking a 50 bp cut). <\/P><br \/>\n<P>The forecast is more dovish than market expectations and reflects recent very weak economic news, which has counterbalanced adverse inflationary indicators. <\/P><br \/>\n<P>Interestingly, the <em>Sunday Times<\/em> Shadow MPC result was also dovish this month, with three members voting for an immediate cut and four others with an easing bias. <\/P><br \/>\n<P>Meanwhile, annual growth in the Bank of England\u2019s adjusted M4 measure \u2013 which excludes money holdings of certain financial corporations that act mainly as a conduit for interbank business \u2013 fell further from 8.8% in March to 8.0% in June, according to figures released this morning. This is the lowest since 2004 and compares with an 11.4% annual increase in headline M4 \u2013 see chart. Monetary trends now appear to be consistent with inflation returning to target over the medium term. (Post-ERM experience suggests adjusted M4 growth of 6-8% <em>pa<\/em> is consistent with 2% CPI inflation \u2013 see <A href=\"http:\/\/www.moneymovesmarkets.com\/journal\/2008\/6\/26\/the-monetarist-case-against-uk-rate-hikes.html\">here<\/A>.)<\/P><br \/>\n<P><span class=full-image-block><span><img decoding=\"async\" src=\"\/storage\/UK_Money_Supply_M4.jpg?__SQUARESPACE_CACHEVERSION=1217848731417\"><\/span><\/span> <\/P><\/p>\n","protected":false},"excerpt":{"rendered":"<p>My MPC-ometer suggests several MPC members will join David Blanchflower in seeking a cut in rates this month but will be outvoted by a slim majority in favour of no change. The model results are consistent with either 5-4 (four votes for a 25 bp cut) or 6-3 (two votes for 25 bp with DB [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-2621","post","type-post","status-publish","format-standard","hentry","category-money-moves-markets"],"_links":{"self":[{"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/posts\/2621","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2621"}],"version-history":[{"count":1,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/posts\/2621\/revisions"}],"predecessor-version":[{"id":4930,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=\/wp\/v2\/posts\/2621\/revisions\/4930"}],"wp:attachment":[{"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2621"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2621"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mmm.9dotdigital.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2621"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}