BoE and BoJ Take Center Stage After Fed Hike

The Bank of England (BoE) and the Bank of Japan (BoJ) are taking center stage today, following the Federal Reserve's (Fed) rate hike yesterday. The BoE is expected to maintain its current interest rate at 3.75%, in line with market expectations and consensus.

According to forecasts, Governor Bailey will lead the majority vote for a hold, similar to July's outcome of 6-3. The Bank Rate is predicted to remain unchanged until Q2 2027, when the BoE may resume its rate-cutting cycle with another 25bp reduction.

In Japan, the BoJ is expected to hike its policy rate to 1.25%, a move that has largely been priced in by investors. The central bank aims to signal a more nimble approach to tightening, rather than the cautious hiking cycle seen so far. Fresh CPI data for August will be released ahead of the meeting.