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The Bank of England opted to hold off on an interest-rate hike that futures markets had fully priced in.
The Bank of England decided to keep interest rates at 0.1%, rather than raise them to 0.25%, in a 7-to-2 vote.
The pound
GBPUSD,
immediately sunk, trading below $1.36.
U.K. consumer prices climbed 2.9% in the 12 months ending September, and the central bank expects inflation to rise further. An Office for National Statistics survey released on Thursday showed that one in six businesses either couldn’t get the supplies they needed, changed suppliers or had to find alternatives. A surge in wholesale gas prices also is impacting the U.K. economy.
The Bank of England last hiked rates in August 2018, to just 0.75%. The base rate hasn’t been above 1% since 2009.
