BOE Interest Rate Hike Pause Possible Amid Resilient UK Economy

The UK economy showed signs of resilience to energy price spikes, with both Eurozone and UK PMI data indicating continued expansion in the private sector in September.

However, the UK composite PMI slowed compared to August, coming in at 51.7, while the Eurozone composite PMI rose to 53.1 from 52.

Despite this, input price inflation accelerated sharply, reaching June levels and higher input cost pressures were noted in both manufacturing and service sectors.

The OECD recommended that the Bank of England (BOE) can avoid raising interest rates, citing tight enough policy, which is helping UK bonds recover today and weighing on sterling.