According to Jinshi, analyst Justin McQueen said that the market has fully digested the Bank of England's expectations of a summer rate cut. The question now is the specific timing of the first rate cut, with a 54% probability of a rate cut in June. One of the main points of the Bank of England's May policy meeting was that its rhetoric shifted to a more data-dependent stance. Due to the low response rate and quality issues of the official labor market report, the bank will pay more attention to the April inflation report to be released next week to provide a basis for when to cut interest rates.
BoE Deputy Governor Broadbent made this clear earlier, noting that he would be watching services inflation more closely than wages in the short term. This also highlights that services inflation, a measure of inflation persistence, will be the key indicator to watch. Nonetheless, given that the market is roughly 50/50 on a June rate cut, and CPI data is the key determinant, GBP's sensitivity to the data will increase.