The Bank of England may be forced into hiking interest rates within the next two days after failing to calm panicked markets as the Pound tumbles – amid fears the base rate could hit six per cent next year.
Governor Andrew Bailey today issued a statement insisting Threadneedle Street ‘will not hesitate to act’, though did not pull the trigger on an increase that markets had anticipated following Kwasi Kwarteng’s tax-cutting Budget.
But Viraj Patel, a foreign exchange and global macro strategist at Vanda Research, said markets will have been disappointed by the statement, adding that he believes it will last only a day or two before the Bank of England is forced into action.
He tweeted: ‘No action from the BoE based on latest statement… looks like they aren’t doing anything inter-meeting.
‘This will be a disappointment for $GBP markets. I suspect this statement will last 24-48 hours before something breaks in markets & forces the BoE to act.’
Meanwhile, there are fears that interest…