The rise in oil prices and the impact of the Middle East situation have raised market expectations for the Bank of England to raise interest rates

Due to rising oil prices and inflation concerns, the market has raised expectations for the Bank of England to raise interest rates in 2026. The conflict in the Middle East has intensified, and investors expect high inflation. The Bank of England has raised interest rates to cope with inflationary pressures. The market expects the Bank of England to raise interest rates by 25 basis points in November, with a 93% chance of a rate hike in December. Last week, the market expected the Bank of England to raise interest rates by a total of 38 basis points in 2026.