Read the story here. Advertise at Before It's News here.
Profile image
By Pound Sterling Forecast (Reporter)
Contributor profile | More stories
Story Views
Last hour:
Last 24 hours:

Will the Bank of England stop hiking interest rates after next week’s expected hike, and how could this impact GBP exchange rates?

% of readers think this story is Fact. Add your two cents.

The Bank of England is expected to hike interest rates once again on the 21st of September, bringing the base rate of interest up to 5.5%. This would be a 15th consecutive interest rate hike from the central bank, with the rate currently sitting at a 15-year high.

Throughout the year the increasing rate hikes have helped push the Pound higher against most currency pairs, and the Pound was the strongest performing currency of the G10 in the first half of the year.

Expectations of further hikes have been downgraded though, and this has had a knock-on effect to the Pound’s value especially against the US Dollar.

Previously, economists were pricing in hikes of up to 6% and potentially higher although the outlook has become more bearish in recent weeks. The Governor of the Bank of England, Andrew Bailey recently said that the BoE is ‘much nearer’ to peak interest rates and this comment has swayed opinion on the BoE expected plans for future interest rates hikes.

The impact on GBP exchange rates has been very clear especially in regard to GBP/USD. The pair are currently trading around a 3-month low and last week they fell below the 1.2500 psychological level. This is over a 6-cent drop from the highs in summer and shows GBP weakness.

Whilst the Pound hasn’t dropped by much at all so far against the Euro, if the GBP/EUR pair follow the pattern of GBP/USD there could be some distance for GBP to fall.

The expectation now is for next week’s interest rate rise to 5.5% to be the last one after the comments by governor Bailey. I think the key topic after that hike will be how long the markets expect to see the interest rates up at these elevated levels, and this could determine the Pound’s strength or weakness moving forward.

The post Will the Bank of England stop hiking interest rates after next week’s expected hike, and how could this impact GBP exchange rates? appeared first on Pound Sterling Forecast.


Before It’s News® is a community of individuals who report on what’s going on around them, from all around the world.

Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.

"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.

Please Help Support BeforeitsNews by trying our Natural Health Products below!

Order by Phone at 888-809-8385 or online at M - F 9am to 5pm EST

Order by Phone at 866-388-7003 or online at M - F 9am to 5pm EST

Order by Phone at 866-388-7003 or online at M - F 9am to 5pm EST

Humic & Fulvic Trace Minerals Complex - Nature's most important supplement! Vivid Dreams again!

HNEX HydroNano EXtracellular Water - Improve immune system health and reduce inflammation.

Ultimate Clinical Potency Curcumin - Natural pain relief, reduce inflammation and so much more.

MitoCopper - Bioavailable Copper destroys pathogens and gives you more energy. (See Blood Video)

Oxy Powder - Natural Colon Cleanser!  Cleans out toxic buildup with oxygen!

Nascent Iodine - Promotes detoxification, mental focus and thyroid health.

Smart Meter Cover -  Reduces Smart Meter radiation by 96%! (See Video).

Report abuse


    Your Comments
    Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

    Load more ...




    Email this story
    Email this story

    If you really want to ban this commenter, please write down the reason:

    If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.