FXStreet (Córdoba) - Next week, the Bank of England (BoE) will announce its decision on monetary policy and will also publish the Quarterly Inflation Report. According to Jane Foley, Senior FX strategist at Rabobank, potential easing from the ECB by year end could push the BoE to delay its first rate hike in order to prevent too much monetary tightening being transmitted via the exchange rate. Key Quotes: “A month ago we pushed back our forecast for the first Bank of England rate hike of the cycle from May 2016 to August 2016. We remain out of step with the consensus of the Reuters survey of economists which now favours Q2 for the first move, compared with Q1 in the previous survey.” “The most hawkish of economists’ views appears to be focused on the increase in wage inflation in the UK and on the assumption that this will breed broad based price pressures in the foreseeable future. We would argue, however, that the signals coming from the labour market are not completely clear and that continued weakness in commodity prices should also continue to limit the potential for a recovery in headline inflation.” “Additionally, sterling strength should place a cap on imported price pressures. Given the rise in market forecasts regarding the likelihood of more ECB easing by year end, the BoE may be more likely to delay its first rate hike in order to prevent too much monetary tightening being transmitted via the exchange rate.” “That said, a rise in the value of the UK’s effective exchange rate would be countered by any USD appreciation which could be triggered by a December 2015 Fed rate hike.” “Given that the BoE and the Fed are the only two G10 central banks to have set the scene for the next policy move to be a rate hike we expect GBP/USD to remains in a range medium-term, albeit a potentially choppy one.” For more information, read our latest forex news.