BoE MPC minutes likely more dovish

The key features in the month up to the last BoE MPC meeting were the fall in inflation and the associated continued appreciation of sterling. 

Looking at the latest speech from Mark Carney, he seems to be placing increasing emphasis on the potential for more downward surprises to inflation from the rising pound. Moreover, even the erstwhile hawk, Martin Weale, in his speech is saying the same thing: "I am starting to wonder whether a rising exchange ratemight be the next of these [downward inflation] shocks."

Therefore I would not be surprised to see the minutes drop the passage that "For two members, the immediate policy decision remained finely balanced: given the outlook for inflation beyond the short term, there could well be a case for an increase in Bank Rate later in the year."

Societe Generale notes its comments as follows:

• There is likely to be more discussion of the risks of that exchange rate shock to inflation. The big surprise in the February minutes was the reference to the possibility of cutting Bank Rate and that: "for one member, the next change in the stance of monetary policy was roughly as likely to be a loosening as a tightening."
  
  
• Given the new emphasis on downside risks, that passage is likely to be repeated. The vote for unchanged rate and asset stock policy should again have been unanimous.