Bird Watching Affirms BOE on Fastest Hike Path Since 1995

The Bloomberg Economics Spectrometer highlights a growing likelihood that the Bank of England will raise interest rates by 50 basis points to 1.75% on Thursday. That would be the biggest hike since 1995 and reinforce a growing view that the central bank is prepared to risk growth in order to bring price gains to heel. While BE’s base case is the softening growth outlook prompts the BOE to revert to more traditional 25-basis point increments after this meeting, taking rates to 2.75% by February, the risk is that a faster pace of tightening continues into the fall.

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