Bailey Warns Against Rate Hike Bets Amid Uncertain Economic Outlook

Bank of England Governor Andrew Bailey said the economic outlook is too unpredictable to judge whether markets are correct in pricing in nearly four interest rate increases over the coming year. Bailey made the comments after the central bank left interest rates unchanged, warning of rising inflation pressure.

In a Reuters report, Bailey stated that officials at the Bank of England had not discussed the possibility of raising rates four times during their deliberations. He acknowledged that markets must form their own views but described the current situation as too uncertain to rely on such expectations.

Bailey has previously commented on market rate expectations, including in April when he suggested markets were getting ahead of themselves by pricing in multiple increases, and in July when he stressed that a rate increase later in the year was far from certain.