BoE Hawkish Tone Falls Flat for Pound Sterling

The Bank of England's Monetary Policy Committee (MPC) members testified before the Treasury Committee on Tuesday, and their hawkish score was a 7.2 against an average of 6.0.

Despite this, the Pound Sterling did not react positively to the testimony, trading just under 1.3550 after a session that spanned 40 pips.

The Governor explained that inflation risks are pointing upwards and that Britain is not close to a recession, but also asked the committee to drop the idea of an unconditional plan to raise rates.

Swaps fully price a quarter point by December and a second by March 2027, while every one of the 65 economists in a Reuters survey expects a hold on September 17, and 57 of them expect nothing further this year.