First hike from BoE likely in August

The economy is growing at a solid pace, the slack in the labour market is diminishing and inflation is mainly being pulled down by temporary factors. 

The falls in energy and food prices should drop out of the inflation rate towards the end of the year. 

Danske Bank notes...

• The Bank of England can look beyond the low headline inflation if the medium-term inflationoutlook calls for a tighter monetary policy, as the MPC recognizes that monetarypolicy works with a lag. 
  
  
• However, we stress that risks are tilted towards a hike later in Q3 or possibly in Q4 as wage growth is still subdued and the appreciation of sterling puts downward pressure on inflation through lower import prices. 
• We still expect the first hike in August.