Australia foreign exchange, good pound! Bank of England interest rate hike 25 basis points possibility of about 62%, investment banks said there is also hope to raise interest rates 50 basis points

Markets expect the Bank of England's Monetary Policy Committee to choose to raise interest rates by 25 basis points this week, raising the main bank rate to 5.25% by about 62%. Goldman Sachs believes the Bank of England is more likely to raise rates by 25 basis points than to raise rates by another 50 basis points. However, Barclays believes a 50 basis point hike is possible due to high UK wages and core inflation.

At 19:00 Beijing time on Thursday, August 3rd, the Bank of England will hold an interest rate decision. Market expectations for the Bank of England's next monetary policy move are divided, and policymakers are approaching a turning point in the fight against inflation.Refinitiv data showed that as of Tuesday morning, the market expected the monetary policy committee to choose to raise interest rates by 25 basis points, putting the probability of raising the main bank rate to 5.25% at about 62%.

Another 38% of market participants expect the central bank to raise interest rates by 50 basis points for the second time in a row, following a surprise sharp increase in June. Inflation in the UK looks to be weakening, but remains much higher than in other advanced economies and well above the Bank of England's 2% target.

The UK's overall CPI fell to 7.9% in June from 8.7% in May, while the core CPI (which excludes volatile energy, food, alcohol and tobacco prices) remained at an annualized rate of 6.9%, but retreated from a 31-year high of 7.1% in May.

The data released by the British Retail Consortium on Tuesday also showed that year-on-year retail price growth in the UK fell to 7.6% in July from 8.4% in June, the first decrease in month-on-month growth in two years, suggesting that the UK may have passed the worst of its long-term cost of living crisis.

Despite 13 successive interest rate rises by the Bank of England, the economy has proved surprisingly resilient, with gross domestic product flat in the three months to the end of May but no recession expected.

Goldman Sachs said this week's meeting was a "fluke", given the limited interpretation of the monetary policy committee's economic data for the last two months.But a 25 basis point rate hike is more likely than another 50 basis point hikeThe Wall Street giant expects the Bank of England to vote 8-1, with only one person opposed to keeping interest rates unchanged.

Economists at Goldman Sachs said: "While the headline data was stable, the pre-August data were more mixed than before the June meeting, when labour market, wage growth and services inflation all rose unexpectedly. In addition, developments this week - including weak PMI previews, information of no commitments from the Federal Reserve and the European Central Bank, and a pullback in market pricing for the August meeting - would support the case for a 25 basis point rate hike."

Barclays believes that the possibility of a 50 basis point rate hike due to high UK wages and core inflation means there is an opportunity for the beleaguered Monetary Policy Committee to take more "resolute action" to "enhance credibility".

Barclays economists Abbas Khan, Mariano Cena and Silvia Ardagna concluded in a research note on Friday: "We expect the Bank of England to see eight votes in favour of a 50 basis point rate hike and one vote in favour of keeping rates unchanged as a final outcome, with forward guidance unchanged and explicitly allowing for greater inflation persistence."

GBP/USD daily chart

At 14:00 on August 2, Beijing time, the pound against the dollar was 2771/72