Pound, U.K. Yields Rise as Traders Lift Bets on BOE Rate Hike
- Bank rate seen rising to 0.25% by February, 0.5% by August
- BOE vote shows shift toward higher rates, Mizuho’s Jones says
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The pound and U.K. bond yields rose in tandem as the Bank of England’s comments on a stronger case for tightening prompted traders to bring forward their expectations for a rate hike.
Sterling rose as much as 0.7% to the day’s high of $1.3714, while the 10-year yield climbed five basis points to 0.85%. Traders now see the BOE raising rates by 15 basis points to 0.25% in February 2022, having priced it for May before Thursday’s meeting.