The 50 basis point (bps) interest rate rise by the Bank of England today, from 4.50% to a near 15-year high of 5.00%, is unlikely to be the last hike given the UK’s higher and longer lasting inflation problem. We think the inflation battle is not yet won and that the Bank will raise rates at least once more, in August to 5.25%, and keep rates at their peak until the second half of next year.
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