BOE’s Greene Says Traders Were Right to Trim Rate Hike Bets

Bank of England policymaker Megan Greene said markets were justified in dialing down bets on interest rates hikes after last month’s surge, speaking in Washington.Author of the article:You can save this article by registering for free here. Or sign-in if you have an account.(Bloomberg) — Bank of England policymaker Megan Greene said markets were justified in dialing down bets on interest rates hikes after last month’s surge, speaking in Washington.Subscribe now to read the latest news in your city and across Canada.Subscribe now to read the latest news in your city and across Canada.Create an account or sign in to continue with your reading experience.Create an account or sign in to continue with your reading experience.In a Bloomberg TV interview on Wednesday, Greene suggested the current market position — which implies two or fewer interest rate rises this year — is “about right.” Until a recent easing, swap pricing pointed to more hikes as the BOE said it was prepared to respond to inflation from the Iran energy shock.“Virtually no one has said to me, ‘we expect you to hike four times,’ which is what was priced at the very peak,” Greene told Bloomberg TV’s Francine Lacqua. “It’s come off of that, which I think is about right.” Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Going into their April 30 meeting, BOE policymakers face a trade-off between inflationary pressures linked to the Iran war and a weak economy and jobs market. Investors will be poring over rate-setters’ comments for more guidance, as officials speak at this week’s International Monetary Fund events in the US.Greene, one of the most hawkish voices on the Monetary Policy Committee, warned that the UK may see “mini waves of inflationary bouts” in the coming months even if there’s an immediate end to the war. While some businesses are already impacted by surging energy prices, consumers will only start feeling the pinch when a price cap on bills is reset in June. More inflationary pressures could come six months down the line when disruptions in the supply of fertilizer — transported through the Strait of Hormuz — start feeding into food prices.Greene said that she is concerned the energy price spike will make inflation more persistent. While she said the UK is unlikely to get the same second-round effects as in 2022, as there is more slack in the jobs market now, it will take a long time before the BOE gets conclusive evidence.“We won’t have definitive data on whether there are second round effects or not for months and if we wait until we see it, then it will be too late,” Greene said.Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information.365 Bloor Street East, Toronto, Ontario, M4W 3L4© 2026 Financial Post, a division of Postmedia Network Inc. All rights reserved. Unauthorized distribution, transmission or republication strictly prohibited.This website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.You can manage saved articles in your account.and save up to 100 articles!You can manage your saved articles in your account and clicking the X located at the bottom right of the article.