The City is betting on two more interest rate rises by May, despite requests by the Bank of England’s governor not to get “carried away”.
A 91.5% chance has been priced in by the markets that the central bank will raise interest rates by another 0.25% at its next meeting on 17 March, followed by a move to 1% in May.
It comes after the bank’s monetary policy committee voted to raise the base rate to 0.5%, but four members of the nine-person committee wanted to increase it to 0.75%.
The split has led investors to predict that interest rates will continue to rise throughout the year, reaching 1.5% by the MPC’s December meeting.
