<span>STORY: :: Bank of England Governor Andrew Bailey says markets are still ahead of them in pricing interest rate hikes</span><span>:: London, England / 1 April 2026</span><span>“I was very clear a couple of weeks ago. I mean, I think I used a little bit more direct language than I normally do, I think you’ve outdone yourself. Now, look, what I said a few weeks ago, and I haven’t changed my position to be completely clear, was that there was a reasonable expectation before all this started that we would probably cut interest rates one or two more times this year. So I said that, so it was reasonable for people to expect that. I said a few weeks. I thought before, frankly, I don’t think that’s possible right now. But to go further than that and start speculating about us raising rates, I thought the markets were getting ahead of themselves. Now, what we’ve seen in the last two weeks is A, we’ve had mornings and afternoons where that expectation has moved a little bit, frankly, it’s still pricing us in to raise rates here today, and I think that’s a decision the markets have to make, but I think they’ve moved forward that we need to sit down again and make that assessment for the meeting at the end of this month, but I was very clear two weeks ago that it wasn’t the right thing to do at the next meeting at the end of this month. “We’ll evaluate it, but I’m not going beyond that.” </span><span>Speaking to Reuters at the central bank’s London headquarters, Bailey said the central bank should focus clearly on risks to growth and employment, as well as inflation, when making its next decision on interest rates.</span><span>Financial markets are currently pricing in two rate hikes from the BoE this year and have previously priced in four rate hikes; Most economists surveyed by Reuters expect interest rates to remain steady.</span><span>Before the crisis, British inflation was on track to fall to its 2% target and the BoE had said interest rates were likely to be cut further. This situation changed dramatically with the beginning of the Iranian war.</span><span>Bailey said the BoE was looking “very carefully” at the sharp rise in inflation expectations, but the message it was getting from businesses was that their ability to raise prices was limited. </span>
