Bank of England expected to make 25bps hike as inflation continues to rage

MPC decision tomorrow

The Bank of England is widely expected to make a 25 basis points hike tomorrow (11 May) as inflation remains stickily in the double digits, despite record rises in interest rates over the past two years.

The move would come in the wake of similar decisions from the Federal Reserve and European Central Bank last week. Markets are currently expecting an 84% chance of a 25bps hike, with an average of 65bps of hikes (including tomorrow's move) until the bank's 2 November meeting. This is in contrast to the expectation for rate cuts from the Fed later in the year, where markets are predicting a 91.3% chance of a cut from current rates by November, according to CME Group. US GDP growth drops below expectations to 1.1% in Q1 Mike Riddell, head of macro unconstrained at Allianz Glob...