BOE

Major central banks around the world, except for the BOJ, are in tightening mode on the back of increasing inflation.

With ECB members on the wires this week trying to talk down fragmentation in the Eurozone, along with CPI from the UK, EUR/GBP could be volatile this week.

The 25-basis-point hike was priced in but failure to surprise… is a surprise in this week of central bank surprises

A 25-basis-point hike is priced in, but will the BoE deliver a surprise?

EUR/GBP rises ahead of BoE rate decision. S&P500 tests 2022 low post-Fed.

Hot on the heels of the Fed meeting, the SNB (Swiss National Bank) and BOE (Bank of England) are up next in today’s European session.

A 25-basis-point hike is priced in, but will the BoE deliver a surprise?

Traders should watch the change in expectations of interest rates vs current rates.

The BoE is widely expected to hike interest rates for a third straight meeting as 30 year inflation is set to rise further. Uncertainty in the outlook and concerns over growth could see policy makers adopt a more flexible approach going forwrds.

As the markets are looking for a 25bps hike already, they may begin pricing in a 50bps hike. If so, GBP/USD so continue to move higher.

Although the BOE hiked rates by 25bps, as expected, the consensus was not clear as just under half of the members voted for a 50bps hike.

GBP/USD eases ahead of BoE. EUR/USD awaits the ECB.

Now the euro has erased all of its FOMC losses it is at the hands of today’s ECB meeting as to whether it can extend its rally or hand back gains.

With inflation at a 30 year high and showing few signs of slowing with the BoE hike rates for a second time in under two months?

The UK economy finally recouped losses from the pandemic in November. An Omicron hit in December shouldn't stop the BoE from hiking rates in February.

Today's rate hike signals that the tide has shifted and BOE policymakers are now prioritizing fighting inflation as the biggest economic risk...

Thanks to ‘Plan B” in the UK there is little hope for BOE to hike rates today. And the pound’s reaction is likely to be around the perceived odds of a hike in February.