In January, BoE Governor Mark Carney stated that the central bankers do not expect the oil prices to rise, suggesting that the global economy should benefit out of the current lows. Inflation has drastically fallen and is likely to remain low for a longer period of time as oil prices continue to deteriorate. Further, he reiterated that it was not the right time to hike interest rates.

Despite declining oil prices, a slow wage growth and signs of weakening activity, BoE MPC member Ian McCafferty was firm on his vote for a rate hike in the UK. Markets speculate that McCafferty would withdraw his vote for a hike, however, he seems be to resilient as the CPI is seen dragged over target in the medium term due to risk in domestic cost.