Analysts unanimously expect the Bank of England to maintain rates as demand softens and labor market loosens despite inflation risks.
The Bank of England is widely expected to keep interest rates unchanged at 3.75% this month, according to a Bloomberg poll and UOB economists. GBP/USD rose 0.1% to 1.3326 on Friday, reflecting steady sentiment ahead of the decision.
All seven analysts surveyed by Bloomberg anticipate no change, citing softer domestic demand and a gradually loosening labor market. However, risks remain tilted toward further tightening due to energy price volatility and elevated services inflation, with a second dissent on the MPC signaling internal unease.
Gilts face pressure from Prime Minister Burnham’s fiscal plans and oil price shocks, but the BoE is likely to remain sidelined for now absent a major upside surprise.