Traders Scale Back Bets on Further Bank of England Rate Hikes
Investors are cutting expectations for Bank of England rate rises as AI sector worries weigh on sentiment. LSEG data show markets now fully price two hikes in 2027.
- published on Newsmetry
- original source published
the same feed is available to bots and dashboards through the api. connect the api →
what happened
Investors are dialing back expectations for Bank of England rate increases in the months ahead, as concerns about the artificial intelligence industry weigh on market mood, Market Talk reports.
According to LSEG data, markets now fully price in two BOE hikes in 2027 and a 49% chance of a third by year-end. At the start of the week, they had fully priced in three increases for 2027.
On Thursday, the Bank of England raised its key rate to 4.0%, a move that was widely expected.
why it matters
For sterling and gilts, the expected tightening cycle has become shorter. A smaller path of hikes tends to lower yields and support bond prices, while the pound loses some of its rate-driven support, even though the rate itself has not changed.
market impact
Pound and gilts: fewer expected rate hikes lower yields and pressure the pound.
- British pound pressure down — fewer expected rate hikes reduce the currency's interest-rate appeal
- UK gilts pressure up — a shorter tightening path lowers yields and supports bond prices
tags
instruments
sources
- Markets Pare Expectations for BOE Rate Rises — Market Talk, 6 November 2026 at 09:21 UTC
prepared by the newsmetry newsroom with ai assistance from the sources listed below. not investment advice.
alerts on your topics, the morning digest and the api — in your account.
get stories in real time ↗