Less than 24 hours after the dovish Fed decision, the Bank of England is set to stand out by holding interest rates – but the majority size is uncertain. Live coverage.
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Bank of England has reasons to be hawkish
The Bank of England (BoE) kicked off its hiking cycle in August – but it was kicking and screaming. BoE Governor Andrew Bailey's vote was critical in the tight 5:4 decision.
That hawkish cut is expected to be followed by a decision to leave rates unchanged at 5%, keeping it above the Fed range of 4.75-5.00%. That would give Sterling an advantage over the US Dollar, and also vs. other currencies.
UK core inflation held up at 3.6%, providing ammunition for the hawks. Only two out of nine members are projected to support a second consecutive cut. A narrower 6:3 majority would temporarily weigh on the Pound.
Apart from inflation, Britain's labor market remains solid, and other indicators seem stable, backing a hawkish decision.
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