UK interest rates rise the first time in 10 years

Stuart Cowell HFM

UKGILT, H1

The BoE did the expected and hiked the repo rate by 25bp, taking it to 0.50%. The vote at the Monetary Policy Committee was 7-2. The QE and corporate bond buying totals were left unchanged. The expected hike yielded a sell-on-the-fact reaction, pushing Cable sharply lower, to a 1.3097 low from pre-announcement levels around 1.32. Gilt yields dropped on the as expected rate hike from the BoE. The 10-year yield fell back to an intraday low of 1.2649%, from levels around 1.35% ahead of the announcement. It is now trading at 1.291%, down 5.1 bp on the day. 20. The market is perceiving this as a particularly dovish statement with the next hike pushed out to late 2018. Carney press conference up next.

Author

Stuart Cowell

HFM

With over 25 years experience working for a host of globally recognized organisations in the City of London, Stuart Cowell is a passionate advocate of keeping things simple, doing what is probable and understanding how the news, c

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