Surprise dip in UK inflation means a 2017 rate hike is looking less probable - ING

"This week’s inflation data, which saw headline CPI dip back to 2.6%, casts further doubt over recent hawkish Bank of England comments," ING Senior Economist James Knightley explains.

Key quotes:

"Admittedly, a fair chunk of the recent fall is down to lower oil prices, and as the effect of the weaker pound continues to filter through, we expect inflation to stay in the 2.5-3.0% area for the rest of 2017. Whilst some hawkish voters have said they have “limited tolerance” to above-target inflation, the outlook for wage growth and investment remains subdued."

"Governor Carney has said these need to recover if the Bank is to hike rates, and elevated political uncertainty, higher import costs, and faltering consumer demand suggest businesses will remain cautious. We still think a 2017 rate hike looks unlikely."