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BNP Paribas brings forward BoE rate hike call to Feb

BNP Paribas is expecting that the Bank of England is to raise UK interest rate hikes by 0.25%. And that too by next month. This is early when compared to the early forecast in May.

The bank‘s chief European economist Paul Hollingsworth said in a research note that with the Covid backdrop improving and inflation continuing to surprise to the upside, they now expect the Bank of England to raise interest rates by 0.25%. And that too on 3 February.

In doing so, the BoE would kick start the process of balance sheet reduction. Hollingsworth also added that however, the BoE was still likely to deliver a more gradual pace of rate hikes than is currently priced into markets.

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