BOE Preview: A 25-bps rate hike but pushback against market pricing – Scotiabank

Analysts at Scotiabank offer a sneak peek at what to expect from the Bank of England’s (BOE) monetary policy announcements due on ‘Super Thursday’ at 1200 GMT.

Key quotes

“We see a 25bps hike but some pushback against market pricing.”

“Market pricing for the BoE has held steady at a 95-100% chance of a hike (in February) and a total of five 25bps hikes by end-2023.”

“We think it’s more likely that the bank delivers only 100bps in rate increases this year, which should eventually act as a headwind for the GBP as markets reprice expectations.”

“We see the 1.36 mark as a near-term ceiling for the GBP.”

“It would take a clear sign from the BoE that it is willing to go above its neutral rate for the pound to test 1.38.”

Read: BOE Preview: Bailey needs to go beyond a rate hike to boost GBP/USD on Super Thursday