The Bank of England's nine-member Monetary Policy Committee (MPC) is expected to hold interest rates at 3.75% today, even as bond traders have increased expectations for future hikes. This decision comes despite the US Federal Reserve opting to tighten its monetary policy.
Policymakers on the MPC are anticipated to be split on the vote. Huw Pill, Megan Greene, and Catherine Mann are expected to advocate for an interest rate increase, with some City forecasters suggesting Clare Lombardelli might join them.
In the last week, economists at the central bank reviewed economic data, including CPI inflation which edged up to 3.1% in the year to August, largely due to a jump in fuel prices. However, a looser jobs market, with private sector wage growth at nearly six-year lows and a drop in employees and vacancies over the summer, could influence the MPC's decision.
The Bank is also set to announce its quantitative tightening programme plans for the next year, which involves offloading gilt holdings. City analysts believe policymakers will vote to slow the sale of bonds, following a reduction in annual target sales from £100bn in 2025 to £70bn this year.