Skip to content

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

ICYMI: BoE rate decision

In case you missed it, the Bank of England has kept the benchmark rate unchanged for a second consecutive meeting at 5.25%. This after the US Federal Reserve left rates unchanged at 5.5%, offering relief to markets.

Video poster image

(Video Transcript Summary)

BoE keeps rates steady at 5.25%

In this video, the Bank of England's (BoE’s) decision on interest rates is discussed. Traders are expecting the rates to stay the same at 5.25%. The BoE will release a report with forecasts on inflation and economic growth.

In the UK, inflation is even higher than in the US and Europe, at a significant 6.7%, which means that things are getting more expensive. The UK has been having a tough time in the economy lately, with no growth for the past five quarters (15 months). They just barely avoided a recession a while back.

Now, the BoE has to decide whether to change interest rates or not. Since inflation is still really high, they'll probably want to keep interest rates high too. In their last meeting, some members voted to keep rates the same while others voted for a rate hike. The head of the bank, Andrew Bailey, took the side of those who wanted to keep rates the same.

Sterling susceptible to higher rates

Investors will be watching the reaction in the market very closely. If the bank makes a comment that suggests they might raise rates in the future and the vote is close again, the British pound might go up in value. But it's not expected to be a big jump. The BoE also pays attention to the value of the British pound compared to the euro, and right now it's not doing too well.

The BoE decided to keep interest rates unchanged at 5.25% and most of the policymakers agreed with that decision. They think it's too early to lower interest rates and want to keep them high for a while. They predict that inflation will go down to below 2% by the end of 2025.

Higher oil price can lead to higher inflation

The BoE also expects the economy to grow a little bit – by 0.5% in 2023 and 0.25% in 2025 – so, they don't think there will be a recession. The bank's plan is similar to what the US Fed is doing, which is being ready to act if inflation gets worse.

Another thing they're worried about is the price of oil going up, which could lead to even higher inflation and interest rates. But for now, the decision seems to be to keep things stable as long as inflation keeps going down and the economy stays steady.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Start trading forex today

Find opportunity on the world’s most-traded – and most-volatile – financial market.

  • Trade spreads from just 0.6 points on EUR/USD
  • Analyse with clear, fast charts
  • Speculate wherever you are with our intuitive mobile apps

See an FX opportunity?

Try a risk-free trade in your demo account, and see whether you’re onto something.

  • Log in to your demo
  • Take your position
  • See whether your hunch pays off

See an FX opportunity?

Don’t miss your chance – upgrade to a live account to take advantage.

  • Get spreads from just 0.6 points on popular pairs
  • Analyse and deal seamlessly on fast, intuitive charts
  • See and react to breaking news in-platform

See an FX opportunity?

Don’t miss your chance. Log in to take your position.

Live prices on most popular markets

  • Equities
  • Indices
  • Forex
  • Commodities
website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.

" >


Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Plan your trading week

Get the week’s market-moving news sent directly to your inbox every Sunday. The Week Ahead gives you a full calendar of upcoming economic events, as well as commentary from our expert analysts on the key markets to watch.


For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of spread betting and CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.