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MPC to hold fire despite stronger labour market

The Monetary Policy Committee (MPC) does not seem too concerned by risks from China, while the recent pick-up in wage growth will worry the hawks on the Committee. Indeed, markets have probably gone too far in again pushing back expectations of a hike to the end of next year. Nonetheless, with inflation about to turn negative again and the economic recovery cooling a bit, we doubt that rates will rise until well into 2016.

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