BoE hikes by 75bp, but sees inflation falling short

by | Nov 3, 2022

The Bank of England hiked rates as expected on Thursday, but said that consumer price inflation looked set to fall over a percentage point short of its 2.0% target by the end of its three-year policy horizon.
Bank Rate was hiked by 75 basis points to 3.0%, the biggest increase for 33 years.

However, while one of the Monetary Policy Committee’s nine members voted for a smaller 50bp hike, another voted for a 25bp increase, whereas 2 members had been expected to opt for a half percentage point move.

Sterling reacted quickly and as of 1214 GMT was off by 1.34% to 1.1239.

In parallel, the yield on the benchmark 30-year Gilt was around 16 basis points higher to 3.72%.

— More to follow —

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