The Bank of England is expected to lift Bank Rate to 4.00% from 3.75% on Thursday, while money markets price three further moves beyond that. GBP/USD trades just above 1.3400 and its 200-day EMA, extending a run of five daily gains, with attention on guidance rather than the headline decision. The September split saw three of nine policymakers favour a hike—Pill, Greene and Mann—while Bailey, Breeden, Lombardelli and Ramsden voted to hold, though they referenced persistent energy costs; a move would be the first since August 2023. Some forecasts look for a 7-2 outcome, others for 6-3, and a narrower majority would challenge expectations for the additional tightening embedded in the currency.
Monetary Policy Expectations in the UK and US
LSEG data show markets fully price four quarter-point hikes by September 2027, taking Bank Rate to 4.75%, yet among 30 research houses, 27 expect Thursday’s hike and most look for one more in February, topping out at 4.25%. In the US, the Fed held 3.75%-4.00% on October 28; job openings rose to 7.523m versus 7.13m, while factory orders increased 1.8% versus 1.2%. Brent slipped towards $104 a barrel, as UK inflation rose to 3.5% in September. The BoE publishes at 12:00 GMT, with ADP seen at 69K versus 90K, ISM services expected at 54.8 after 54.9, and NFP forecast at 65K after 29K; unemployment is seen at 4.2%. Prediction markets imply about a 75% chance Democrats take the Senate. GBP/USD resistance sits just under 1.3450, then 1.3500, while support is the 200-day EMA near 1.3400, ahead of 1.3300 and just above 1.3250; Stoch RSI is near 85.
