MUFG Research discusses its reaction to today's BoE policy decision.
"The BoE stepped down the pace of hikes as expected by delivering a 0.50 point hike today, and continued to signal that further hikDes may be needed.
The tight labour market and stronger wage growth are the biggest concerns that could require “further forceful” hikes. It poses the main upside risk to our forecast for the BoE’s policy rate to peak at 4.00% next year," MUFG notes.
"The GBP is set to remain driven more by changes in global financial conditions rather than BoE rate hike expectations," MUFG adds.