Sterling Could Fall if BOE Dampens Rate-Rise Bets

1401 GMT - The Bank of England is likely to push back against elevated interest-rate expectations at Thursday's meeting, leaving sterling exposed, Ebury's Enrique Díaz-Alvarez says in a note. The BOE could raise rates by 25 basis as widely anticipated given resilient growth and stubbornly high inflation but the vote split and the guidance will matter more for sterling, he says. "We expect a split vote and open-ended guidance that provides no explicit commitment to further rate increases in 2027." Market expectations of three more rate rises after Thursday are overly aggressive, he says. Sterling rises 0.2% to $1.3416 versus a weaker dollar after earlier hitting a near seven-week high of $1.3433, according to LSEG. The euro rises 0.4% to 0.8362 pounds.