For updated and more detailed analysis see here.
While leaving interest rates at 4.00% today (as expected) and signalling that rates will still fall from here, the Bank of England reiterated its concerns over rising inflation. As a result, we continue to think rates won’t be cut again until February. Meanwhile, the Bank’s decision to shrink its balance sheet at a slower pace and to tilt the reduction away from long-dated gilts hasn’t, so far at least, reduced 30-year yields.
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