Pound Falls Despite BoE's Hawkish Tone: Market Pricing Remains Disconnected

The Bank of England's decision to keep interest rates at 3.75% has been met with confusion, as the British Pound (GBP) fell against major peers.

Economists expect two UK rate rises this year, but ING still favors a hold, citing cheaper energy prices and the potential for the Bank to avoid raising rates altogether.

Pantheon Macroeconomics expects hikes in November and February, while its argument centers on Governor Andrew Bailey and Deputy Governor Clare Lombardelli's comments suggesting they could join the three existing supporters of a hike, producing a five-member majority.