Traders Fully Price Four Quarter-Point Hikes From BOE in 2026
Commuters pass the Bank of England (BOE) in the City of London.
Photographer: Chris Ratcliffe/BloombergTraders are fully pricing a full percentage point of Bank of England monetary tightening in 2026 for the first time, as the Iran conflict continues to fuel inflationary pressures.
Swap market pricing implies four quarter-point interest-rate hikes, a complete reversal from the two cuts seen before the war. Gilts fell at the open, led by shorter maturities, with two-year yields rising nine basis points to 4.66%, the highest since 2024.