Bank of England Raises Interest Rates 75bps to 3% in Biggest Rise in 30 Years

The Bank of England MPC at its November meeting Thursday raised the key bank rate by 75 bps from 2.25% to 3.00% as expected. BoE’s benchmark rate has not gone up this quickly since November 1989 when it rose from 13.75% to 14.875%. An even bigger hike was briefly imposed on Black Wednesday in Sep1992 but was revoked by then Chancellor Lamont. The vote was 9-0 (However Tenreyro voted for 25 bps, Dhingra voted for 50 bps). The UK has … Continue reading “Bank of England Raises Interest Rates 75bps to 3% in Biggest Rise in 30 Years”

Cable Pounded Again After Indecisive Bank of England Statement

The markets had been waiting for a statement from the Bank of England bout the collapsing Pound. Nothing it seems at this point other than watching. The BoE highlighted the ‘next scheduled meeting’ hinting no intra-meeting move is coming. This could be a game of course, knowing they need a short market for maximum impact. The Sterling and Gilt markets were looking for a stronger hint on intervention. GBPUSD is down 202 pips to 1.0639 after bouncing earlier BOE statement … Continue reading “Cable Pounded Again After Indecisive Bank of England Statement”

Bank of England Raises Interest Rates to 13-year High 2.25% Noted Sterling has Depreciated Materially

The Bank of England MPC at its September meeting Thursday raised the key bank rate by 50 bps from 1.75% to 2.25%, as expected. The vote was 9-0 (However Haskel, Mann, Ramsden voted for 75 bps, Dhingra voted for 25 bps). The BoE noted sterling has depreciated materially since August. Uncertainty around the outlook for UK retail energy prices has fallen after government’s energy support plan. Inflation is at the highest rate for a decade, the sharpest annual incline for … Continue reading “Bank of England Raises Interest Rates to 13-year High 2.25% Noted Sterling has Depreciated Materially”

Liz Truss New British PM as Pound Hits Lowest Level Against U.S. Dollar Since 1985

The British pound hit its lowest level against the U.S. dollar since 1985 as the U.K.’s dismal economic situation spirals out of control. GBPUSD fell as low as $1.1443 before recovering to trade up 0.1% midday London time Monday after Liz Truss was declared leader of the Conservative Party and the next British Prime Minister. Sterling collapse is a flow on from the U.S. dollar rally which has driven the euro and Japanese yen hit twenty years plus highs. The … Continue reading “Liz Truss New British PM as Pound Hits Lowest Level Against U.S. Dollar Since 1985”

Bank of England Raises Interest Rates Sixth Time to 13-year High 1.75%

The Bank of England MPC at its June meeting Thursday raised the key bank rate by 50 bps from 1.25% to 1.75%, as expected. The vote was 8-1 expected (Tenreyro voted to raise bank rate 25 bps to 1.50%). The BoE will be particularly alert to indications of more persistent inflationary pressures, and will, if necessary, act forcefully in response. Bank says policy is not on a pre-set path Inflation is at the highest rate for a decade, the sharpest … Continue reading “Bank of England Raises Interest Rates Sixth Time to 13-year High 1.75%”

Bank of England Raises Interest Rates Fifth Time to 13-year High 1.25%

The Bank of England MPC at its June meeting Thursday raised the key bank rate by 25 bps from 1.00% to 1.25%, as expected. The vote was 6-3 vs 8-1 expected (Haskel, Mann, Saunders voted to raise bank rate 50 bps to 1.50%). The BoE however may act more forcibly if more persistent inflation pressures are indicated. The Bank is balancing bringing inflation under control without plunging the economy into a recession. The move came a day after the Federal … Continue reading “Bank of England Raises Interest Rates Fifth Time to 13-year High 1.25%”

Bank of England Raises Interest Rates Fourth Time to 1.00% and Forecast 10% Inflation and Recession Early in 2023

The Bank of England MPC at its May meeting raised the bank rate by 25 bps from 0.75% to 1.00%, as expected. The vote was 6-3 vs 8-1 expected (Haskel, Mann, Saunders voted to raise bank rate 50 bps to 1.25%). The BoE said some further modest tightening may be appropriate in the coming months. The move followed a day after the Federal Reserve raised rates by a half of a percent at their May meeting. Inflation is at the … Continue reading “Bank of England Raises Interest Rates Fourth Time to 1.00% and Forecast 10% Inflation and Recession Early in 2023”

Bank of England Raises Interest Rates Third Time to 0.75% With Inflation the Priority

The Bank of England MPC at its March meeting voted 8-1 Cunliffe dissented in favor of maintaining bank rate at 0.50%) to raise the Bank Rate from 0.50% to 0.75%. The BoE said some further modest tightening may be appropriate in the coming months. The move followed a day after the Federal Reserve Raised Rates for the first time since 2018. Inflation is at the highest rate for a decade, the sharpest annual incline for 10 years and well above … Continue reading “Bank of England Raises Interest Rates Third Time to 0.75% With Inflation the Priority”

Bank of England Raise Interest Rates by 25 bps from 0.25% to 0.50% as Expected

The Bank of England MPC at its February meeting voted 5-4 (Ramsden, Saunders, Haskel, Mann wanted to hike by 50 bps to 0.75%) to raise the Bank Rate from 0.25% to 0.50%. The BoE voted unanimously to reduce the stock of UK government bond purchases Inflation is at the highest rate for a decade, the sharpest annual incline for 10 years and well above the Bank’s 2% target.  The BoE has warned there was unlikely to be any reprieve over … Continue reading “Bank of England Raise Interest Rates by 25 bps from 0.25% to 0.50% as Expected”