Reassuring PMIs, stubborn inflation, but rates on hold

Following a weak run of data, evidence that the services sector continued to grow at a robust pace in August provided some reassurance that economic growth will maintain a steady pace for the remainder of the year, in line with our forecast. Meanwhile, inflation has continued to be a headwind to real consumer spending growth. But it should gradually ease ahead. Finally, the MPC will leave rates on hold next week. Indeed, given the uncertainty around the terms on which the UK will leave the EU in March, we think that the MPC will wait until May before hiking again.