Investors expect Bank of England to finish rate hike in March

According to the Bank of England survey, 60 major financial companies expect the end of the upward cycle in March. At the same time, rates are projected to rise to 4.25%, up from 3.5% in December. 

The rate forecast in the survey is below the established level in the financial markets, where the assumed rate peaks at 4.75% by August 2023. This difference may reflect that interest rate futures take into account the risk of an unexpected increase.

The Bank of England has said that it may need to raise rates further to make sure the rate of inflation declines to its target level.

Nevertheless, many economists focused on splitting the vote for Thursday's decision to raise rates by 0.5%. Two policymakers opposed a rate hike altogether, while one called for a repeat of November's 0.75% increase.

Market participants said they expected inflation to fall to 5.5% in one year, 3% in two years, and 2% in three years. This downward tendency is considered slower than the Bank of England's forecast.