Bank of England expected to hold interest rates at noon as it assesses fallout from Iran war – business live

The Bank of England is expected to hold rates at 3.75% at noon, but the bigger market driver is the jump in Middle East risk and energy prices, which has sharply complicated the inflation outlook. Oil has surged again — Brent June is up 5.3% at $124.58/bbl after an earlier peak at $126.41, while WTI June is +2.3% at $109.35/bbl — reinforcing the case for a more hawkish central-bank tone and keeping real-rate expectations fluid, a supportive backdrop for gold. Policy focus is squarely on whether the MPC signals renewed tightening pressure rather than the cuts that were expected before the Iran conflict escalated. The article notes one or two BoE members could even vote for a 25bp hike as a pre-emptive move against imported inflation. The ECB is also seen holding steady Thursday but may hint at a June hike, while the Fed left rates unchanged Wednesday, leaving the market to absorb a broader global policy pause against rising energy-led inflation. For precious metals, the immediate implications are a firmer safe-haven bid and a stronger inflation hedge narrative, though higher nominal yields would be the main offset if central banks turn more hawkish. Near term, watch the BoE statement, ECB language, and any further oil escalation; if energy shocks persist, gold should remain supported on geopolitical risk and inflation repricing even if rate-cut expectations are pushed out.