Summary

• There's nothing in today's decision that changes our mind that the next move is likely to be a rate cut in 2027.
• It feels like it would take a lot for the five more neutral-to-dovish members of the nine-strong committee to vote for a hike, barring the Iran deal falling apart and energy prices moving materially higher.
• Pricing power appears limited – or at least more so than in 2022 during the last energy crisis.

By James Smith, Developed Markets Economist, UK

The Bank of England has kept rates on hold at 3.75%, and nothing in this decision changes our view that the next move is likely to be a cut.

Admittedly, there’s