The data were firmer overall than expected,

While the fourth quarter GDP data and the relatively healthy mix of the components further diminishes the chances of a near-term trimming of interest rates, we still believe a 25 basis point interest rate cut is very possible in May.

They are likely to acknowledge the firmer data since the January meeting.

The overall group numbers are a bit better than expected,

The MPC still has to see conclusive sustained evidence that 2006 pay settlements are remaining contained.

The latest data - including the improvement in manufacturing activity and current strength of the housing market - has increased the odds that the eventual next move in interest rates will be up.