BOE Keeps Door Open for November Rate Rise

Dow Jones09-17 19:42

1142 GMT - While Bank of England members remain split, hawkish sentiment appears to be hardening, says Suren Thiru and the ICAEW. The central bank held its key interest rate at 3.75% in a 6-3 vote, "balancing the inflationary fallout from the Iran war-induced energy shock against little evidence that it is fuelling more persistent, economy-wide price pressures." Still, minutes from the meeting pointed to mounting inflation concerns, meaning the chances of a November rate rise have risen substantially, Thiru says. "While policy could still remain on hold this year, persistent U.S.-Iran hostilities mean the risk of a rate hike has shifted from a possibility to a probability." The inflationary impact of the government's budget next month will be a key consideration for the bank, Thiru says.

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