Goldman Sachs Predicts Bank of England Rate Hike in November

Goldman Sachs has revised its forecast for the Bank of England's interest rate hike. According to the bank, there is now a high chance that rates will increase by 25 basis points in November 2026. This change comes after recent data showed that Britain's economy grew at an annual pace of 1.9% in July, driven by strong growth from artificial intelligence and a continued momentum from the first half of the year.

The bank expects inflation to remain high due to rising wholesale energy prices. Oil has surged above $100 a barrel due to renewed hostilities in the Middle East. Goldman Sachs analysts believe that despite these factors, the Bank of England will keep the bank rate unchanged at 3.75% at its September 17 meeting.

However, after a November hike, Goldman expects the BOE to hold rates steady as easing energy prices reduce the need for further tightening. The bank predicts that rate cuts will begin in late 2027.