BoE's Pill signals more rate hikes likely in 2027
Bank of England chief economist Huw Pill says rates may need to rise further in 2027, beyond December's expected move, according to Reuters citing a Financial Times interview.
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what happened
Reuters, citing an interview Bank of England chief economist Huw Pill gave to the Financial Times, reports that the central bank will likely need to lift rates again in 2027, beyond a further increase expected at the December meeting.
Pill described the November hike to 4% from 3.75% as a meaningful move, yet said "we have further to go." He called a near-term end to the US-Israeli conflict with Iran and a drop in energy prices a very low probability, and said he expects to back another quarter-point rise next month.
Markets currently price about 90 basis points of tightening by the end of 2027, which Pill said was not outrageous. He also said he thinks the bank should have acted sooner against inflation.
why it matters
For markets, the signals keep higher policy rates in prices. That typically supports sterling and weighs on gilts, since higher rate expectations push yields up and bond prices down.
market impact
Sterling: tighter BoE policy expectations support GBP; gilts under pressure
- Pound sterling pressure up — expectations of further BoE tightening support the currency
- UK gilts pressure down — higher rate expectations push yields up and bond prices down
tags
instruments
sources
- BOE likely to raise rates further in 2027, Pill tells FT — Reuters, 14 November 2026 at 06:56 UTC
prepared by the newsmetry newsroom with ai assistance from the sources listed below. not investment advice.
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