BoE Interest Rate Hikes Expected Amid Renewed Inflation Fears

J.P. Morgan is predicting that the Bank of England (BoE) will raise interest rates by 25 basis points in November, followed by another hike in 2027.

The BoE's Monetary Policy Committee voted 6-3 to hold its benchmark interest rate at 3.75%, while warning that inflation could rise above 4% early next year.

J.P. Morgan economist Allan Monks expects the central bank to raise rates in November, followed by another increase in 2027, according to a report by Reuters.

The bank then expects the BoE to keep rates unchanged unless there is clearer evidence of second-round inflationary pressures, including a rise in wage expectations to around 4%, as per the report by Reuters.