UK100_m climbs past 7700 amid BoE pause

 
UK100 has rebounded beyond the ~7700 round number following the BoE’s decision not to raise interest rates. Economists were expecting a 0.25% rate increase.

Still, even after today’s pause, markets are predicting a 70% chance that the BOE may yet hike by another 25 basis points by March 2024.

If so, this could potentially mark an end of the BoE’s tightening cycle with a 15th rate hike since December 2021.

Following it’s US counterpart, the UK has also decided to hold off on raising borrowing costs as they expect the CPI to significantly fall in the months ahead

But the UK100 bulls should be warry as further policy tightening might be necessary if the inflationary pressure will continue to mount due to rising energy prices.

From a technical standpoint the UK100 might continue to consolidate further at ~7700 round number.

The volatility levels might increase as more macro-economic data-“hints” will be released before the next policy meeting.