BREAKING: GBP jumps after BoE hikes rates by 50 bp

The Bank of England announced its latest monetary policy decision today at 12:00 pm BST. All economists polled by Bloomberg expected BoE to deliver a 25 basis point rate hike while money markets priced in a 75% chance of a 25 bp rate hike ahead of the meeting and a 25% chance of a 50 bp rate move. However, the meeting was expected to be a close call between 25 and 50 bp rate hikes following yesterday's inflation data from the United Kingdom.

Bank of England decided on the more hawkish option - a 50 basis point rate hike to 5.00%. This is the highest level since September 2008. Decision was made with a 7-2 vote split - 7 votes for a rate hike and 2 votes for keeping rates unchanged. Bank of England noted that persistence of high inflation requires further policy tightening. Bank of England also said that it expects Q2 GDP to be flat on a quarter-over-quarter basis 

GBPUSD surged following a hawkish move from Bank of England with the pair painting a fresh daily high near 1.2835. However, big part of the move has already been erased and sellers try to push GBPUSD back below 1.2800 mark.

Source: xStation5