Ella 
Hawkish (35%): 50 bps rate hike, guidance unchanged
The Monetary Policy Committee voted decisively (8-1) to raise rates by 50 basis points and left key forward guidance unchanged, meaning policy will continue to be decided on a meeting-by-meeting basis. Despite weak inflation expectations, there was no sign that the MPC was done raising rates. GBP/USD is up 0.20%.
Base case (55%): 25 bps rate hike, no change to guidance
The Monetary Policy Committee hiked rates by 25 basis points, with guidance largely unchanged. Little emphasis was placed on the forecast, which pointed to weaker inflation in the second and third years. The bottom line message is that rate hikes will continue as long as the data justify them. GBP/USD is down 0.50%.
Dovish (10%): 50bp rate hike, but signaling the end of the rate hike cycle
The hike was larger at 50 basis points, but the language surrounding the decision suggested it was one that was rushed to an end, with the change in forward guidance raising the bar for future hikes. The MPC hit back at the market’s pricing of terminal rates and highlighted its forecast of low inflation in the second and third years. GBP/USD is down 0.80%.
