Hawks Live At The BoE / Zuckerberg Payday

The Old Lady followed the Fed yesterday in keeping interest rates on hold, whilst also mirroring any expectations of imminent cuts. Of the nine-strong members of the Monetary Policy Committee (MPC), six backed a hold, two backed a 25bp hike, and for the first meeting since August 2008, Swati Dhingra, the MPC’s most dovish member, opted for a cut. The Bank removed any references to hiking rates further, noting inflation has “fallen back relatively sharply” over the past few months, but gave no timetable for cuts.

In the statement released with the decision, BoE Governor Andrew Bailey said: “We have had good news on inflation over the past few months. It has fallen a long way. But we need to see more evidence that inflation is set to fall all the way to the 2% target and stay there before we can lower interest rates.” Money markets reacted, repricing a reduced probability of UK rate cuts in March and May, currently around 13% and 42%, respectively, and a 64% chance of a cut in June, at time of writing.

This afternoon we have the US employment prints for January. After the 216k print in December, the market is going for a more conservative +185k (the whisper is slightly higher), with an unemployment rate of 3.8%, hourly earnings of 0.3%mom, and a participation rate of 62.6%.

Lastly, what a way to celebrate the end of dry January. Meta Platforms Inc, which we hold in our Global portfolio, reported better-than-expected earnings yesterday along with unveiling plans to pay its first ever dividend. The company announced a quarterly cash dividend of $0.50 a share for Class A and B common stock beginning in March. So, the cofounder and CEO Mark Zuckerberg, who holds approximately 350 million shares, will take home about USD 175m in each quarterly payment.