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The British Pound would rise if Dave Ramsden dropped his vote for an interest rate cut on Thursday, as this would materially lower the odds of an August interest rate cut.
The Bank of England is expected to maintain interest rates at current levels on Thursday and signal any decision to cut interest rates will depend on upcoming data.
The consensus, meanwhile, expects the decision to be delivered with a 7-2 vote in favour of keeping interest rates unchanged. Overall, this would be a GBP-neutral outcome.
However, any shift in this vote composition can strongly signal a shift is underway on the Monetary Policy Committee (MPC). The market is currently priced 50-50 for an August rate cut, if these odds fall, the Pound would rise.
With this in mind, any changes in the composition of the vote would provide an initial and strong signal that would influence expectations for August.
The chance of a 6-3 vote for a rate cut is low as this would suggest another member of the MPC has looked at the robust inflation and survey data and thought it signals interest rates must be cut. This would be highly unusual.
There is a greater chance that the MPC will revert to an 8-1 vote in favour of keeping interest rate cuts, with Dave Ramsden dropping his vote in light of April's above-expectation inflation print.
"An even more hawkish outcome would be if Ramsden were to change his vote back to a hold. In his 19 April speech, Ramsden argued that the risks to persistence in domestic inflationary pressures are receding, and so if he believes the latest inflation data has been strong enough to change his view on inflation risks, then he could very well change his vote back to a hold," explains Lucas Krishan, Macro Strategist at TD Securities.
"This would be a clear sign that the MPC is not just uncomfortable by the latest data, but that there is quite a large risk that the MPC will not even cut Bank Rate this year," he adds.
Ahead of the Bank's Thursday decision, markets and the MPC will have May's UK inflation print to chew on.
"We think the May CPI report would have to surprise quite sharply to the upside for this to be the case. If that does not happen, Ramsden would probably justify another vote for a cut by saying that "[t]here are likely to be bumps in the disinflation process from one month to the next", like he said back in April," says Krishan.