Daily Alert – Friday 4th August 2023: BoE raises rates to 5.25%, vote split

Mark NugentAug 2023, Daily Alert

Daily Alert – Friday 4th August 2023: BoE raises rates to 5.25%, vote split

Good morning.

Yesterday we saw the Bank of England raise interest rates by the expected 25 basis-points, to 5.25%. The votes were split, with two members of the Monetary Policy Committee seeking a 50 basis-point hike, one seeking no change and the majority, six in number, opting for the delivered 25 basis points. Governor Bailey said the bank will be “sufficiently restrictive for sufficiently long” to reach 2% inflation as per the bank’s mandate. Markets are now predicting the peak rate at 5.75% in the first half of 2024. The GBP index was down as markets feel that the aggressive hiking cycle is over, and we are close to the peak rate.

Markets have been almost exclusively indecisive in terms of risk sentiment this week.

I placed no trades.

All that is left for the week is Non-Farm Payroll in the US, where the expectation is for a relatively low figure of 200K jobs created in the last month.

Have a great weekend when it comes, and I’ll be back on Monday.

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