Why Bank of England Hawks Are Gaining Ground as Inflation Heads Above 4%

A Bloomberg Economics model shows Bank of England officials are the most hawkish since early 2023, and markets price a near-certain rate increase on Nov. 5. The BoE held its rate at 3.75% in September on a 6-3 vote, so two members switching would flip the result. The BOESPEAK model scores Monetary Policy Committee members’ tone, with positive readings signaling a preference for higher rates. Bloomberg Economics’ Dan Hanson links the shift to energy costs and expects hikes in November and February, while conceding the committee may only be talking tough. Governor Andrew Bailey, a swing vote, says prolonged high energy prices make a hike harder to avoid; inflation is projected above 4% early next year, twice the 2% target.