Citigroup expects BoE to hike 25bps in Q4 2026 and a further 25bp in Q1 2027 (prev. saw rates on hold until Q2 27)

Forecast changes of this kind move markets only at the margin on their own; what has historically mattered is whether they mark the leading edge of a broader repricing, since one prominent house flipping tends to precede clustering of similar revisions when the underlying data impulse is shared. The substance here is the direction of travel: a desk moving from 'on hold' to 'hiking' implies its read on UK inflation persistence, wage dynamics, or the MPC's reaction function has turned, and the hawkish skew is notable given that most BoE cycles in recent memory have been debated in terms of when and how fast to cut. The relevant transmission is the short end, SONIA futures and the front of the gilt curve, plus sterling via rate differentials, though a lone forecast typically leaves little trace without corroboration. Worth watching is whether other houses follow, how the call squares with the next MPC communications and inflation prints, and whether the desk's economists have form for being early on BoE turns.