Bank of America: Investors Raise Bets on Bank of England Rate Hikes as UK Remains Sensitive to Oil Prices

Investors have raised expectations for Bank of England rate hikes in 2026 after a new round of tensions between the United States and Iran pushed oil prices higher. According to Jin10, Bank of America strategists said in a report that the UK remains highly sensitive to global oil price shocks, prompting investors to reprice interest-rate expectations. Data from London Stock Exchange Group showed the market was pricing in a total of 27 basis points of Bank of England rate hikes this year, up from 20 basis points priced in a week earlier.