More hikes in the pipeline

The BOE is set to meet next on June 7 and again on July 5. But, for now, most market watchers don’t expect another rate hike until the August meeting. The May 23 release of the minutes from the latest BOE Monetary Policy Committee (MPC) meeting revealed hawkish views. The MPC voted unanimously to raise its rate 0.25 basis points to its current six-year high at 5.50 percent, but also showed the members had discussed the possibility of a 50-basis point rate hike.

Currently, analysts say the market is priced for two more rate hikes of 0.25 basis points each before year-end. But, for now, most banks and economists are just calling for one more rate hike, which would leave the base rate at 5.75 percent by year-end.