On Thursday, the Bank of England (BoE) announced a rate hike of 25 basis points to 4.25%, as expected. Danske Bank analysts They consider that, given that both domestic growth and inflation have surprised to the upside and taking into account the BoE’s message, they anticipate an additional rise of 25 basis points in May 2023.
The BOE rate will reach a maximum of 4.50
“As the 25 basis point hike was fully priced in by the markets, market reaction to the announcement was limited. 10-30 year yields were broadly unchanged while 2 year rates were down a few points The market price of the top rate fell slightly to 4.5% in August (from 4.6%).”
“We revised our forecast and expect the Bank of England to apply a final 25 basis point hike in May. Our expectations are in line with current market prices (currently 30 basis points through August 2023) as we expect the rest of the BoE committee to become less and less aggressive in a context of weakening growth and easing labor market conditions Markets expect cuts of 30 basis points during the second half We continue to believe that the first rate cuts will not be will produce before the beginning of 2024”.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
