The Bank of England raised interest rates at its latest monetary policy meeting, and every policymaker voted in favour. Catherine Mann went further, voting for an increase of 50 basis points.
Governor Andrew Bailey said the move was unlikely to be the last. Unless the war were to end suddenly, he said, there is a strong case for a further rate rise. He gave no timetable.
Sterling’s reaction faded
Sterling benefited only briefly from the hawkish decision and gave up its gains as the day went on.
By our market data, as of 04:31 GMT on 7 November, GBP/USD stood at $1.3348.
When the next move may come
Commerzbank expects the next increase in February rather than December. Michael Pfister of Commerzbank said the pound is likely to struggle to trade any higher until that next rise.
The bank says the case for further hikes would weaken if the Middle East situation stabilises and energy exports normalise.
Related: Czech central bank raises rates in 4-3 vote, koruna weakens · Bank of England raises rate to 4% in 8-1 vote
Source: Bank of England | Data: Swissquote
