Governments have been able to overrule the Reserve Bank for 80 years. Why stop now? 
Think the RBA will lift rates on Melbourne Cup day? Don't bet your house on it 
As treasurer, Bill Hayden set Labor on the path to economic rationalism 
Inflation: raising interest rates was never the right medicine 
Bank of England (BOE) was largely expected to follow FED in hiking rates, it is still expected to do so however there is a difference now. Initially it was expected to do so, due to its aggressive hawkish tone, now it's still expected to follow FED but that is due to lack of any other candidates, since all other majors are still easing.
Pound got hammered to lowest level since 2010, as BOE's commentary turned dovish and last inflation report showed that it might not reach target range, even if BOE refrain from any hikes in 2016. Latest turmoil in global financial market, stemming from China has also posed considerable doubts over BOE's ability to hike rates this year, especially with inflation hovering near zero.
So key question facing pound now - when will BOE rate hike would start getting priced in favor of Pound?
The answer to the question is simpler than many would expect. It would be data dependent. Yesterday's industrial production report showed in November, manufacturing and industrial production (-1.2% y/y and +0.9% y/y respectively), dropped to lowest level since 2013.
Moreover, Bank of England (BOE) announced current wage growth (approx. 2.5-3%) not sufficient to generate desired inflation target. But higher wage growth for an economy growing at 2.3% and inflation at zero won't be easy to achieve.
Above all, biggest risks threatening UK is the possibility that the country might vote to exit from European Union.
Unless these issues are considerably tackled, it is difficult for BOE hikes to be priced in. So key upside mover would remain Dollar for GBP/USD, which is currently trading at 1.444 against Dollar.
