GBP/USD Tests 1.3400 as Traders Wait for the Bank of England's November 5 Rate Decision
Sterling goes into Thursday with the market almost fully convinced of the outcome — and that is precisely why the decision still matters. The Bank of England announces its next rate decision on Thursday, November 5, with Bank Rate currently at 3.75%. Markets and several large banks expect a rise of 25 basis points to 4%, which would be the first increase since 2023. GBP/USD traded near 1.3463, up around 0.36%, after advancing from the 1.3400 area ahead of the announcement.
The reason for the expected rise is inflation that refuses to sit at target. UK annual inflation rose to 3.5% in September, from 3.1% in August, well above the Bank's 2% target and the highest in almost a year, driven in part by higher energy prices linked to the conflict with Iran. At the last meeting, on September 17, the Monetary Policy Committee voted 6–3 to hold the rate, with three members — Greene, Mann and Pill — already voting for a rise to 4%. A Reuters poll of economists pointed to a 7–2 vote in favour of a rise this time, while other forecasts, including Deutsche Bank's, pointed to 6–3. Goldman Sachs, BNP Paribas, JPMorgan and Bank of America are among the banks expecting a November rise, and market pricing put the chance of a rise at roughly 90–96%.
The levels traders are watching:
• Resistance: initial resistance sits at 1.3475–1.3480, followed by 1.3500.
• Support: support lies around 1.3430–1.3440 and 1.3400–1.3405.
• The bigger picture: GBP/USD bottomed at 1.3137 on October 14, rallied about 263 pips, was rejected near 1.3410, and by late October sat near 1.3375 — the pound has been bid on the hike story for three weeks.
That positioning is the real story of this decision. When a hike is 90–95% priced, the 25 basis points themselves rarely move the market much. The vote split and the guidance do. A unanimous 9–0 hike would read as intent to keep going, and could add to the hikes already priced for 2027. A narrow 5–4 hike with dovish language — a falling forecast, a line about looking through the energy shock — would read as "one and done", and could take sterling lower even though rates went up. Same decision, opposite currency move, depending entirely on the detail. Traders who bought sterling near 1.34 on the hike story are, in effect, long the vote split, not just the rate.
Why the Bank faces a difficult call. The Bank's dilemma is visible in the numbers. Inflation at 3.5% argues for tighter policy, but the source of that inflation — an energy price shock — is the kind of shock that rate rises do not fix quickly, and that can fade on its own. The European Central Bank kept its deposit rate at 2.50% on October 29, and the US Federal Reserve held at 3.75% to 4.00% in late October, so the Bank is not moving in lockstep with its peers. The autumn budget on October 28, eight days before the decision, added fiscal demand to the mix. And the Bank publishes its November Monetary Policy Report alongside the decision, with updated inflation and growth projections that markets will read as carefully as the rate itself.
What comes after Thursday. Thursday is not the end of the week's forex calendar. October US non-farm payrolls land on Friday, November 6, and the prior print was weak — September payrolls rose just 29,000. For GBP/USD, that means two high-volatility events in two days, with the dollar side of the pair getting its own catalyst the morning after the Bank's decision. For traders in Pakistan, India and Bangladesh watching GBP/USD or EUR/USD, the practical lesson is about timing: scheduled central-bank and jobs events compress weeks of drift into minutes, and position sizes set for a quiet day are the wrong sizes for a decision day.
FAQ:
When does the Bank of England announce? At 12:00 London time (12:00 UTC) on Thursday, November 5, 2026, alongside the November Monetary Policy Report, followed by a press conference.
What is Bank Rate now, and what is expected? Bank Rate is 3.75%. Markets widely expect a 25-basis-point rise to 4%, which would be the first rise since 2023.
What was the vote last time? On September 17 the committee voted 6–3 to hold, with three members preferring an immediate rise to 4%.
What are the key GBP/USD levels? Resistance at 1.3475–1.3480 then 1.3500; support at 1.3430–1.3440 and 1.3400–1.3405.
Why could sterling fall even if rates rise? Because the hike is already priced. A narrow vote split or dovish guidance would signal "one and done" and unwind the long sterling positions built up over the last three weeks.
What is the next big event after the decision? US non-farm payrolls on Friday, November 6, which will move the dollar side of GBP/USD and every other dollar pair.
Follow forex coverage on the Zimbuck News page (https://zimbuck.com/pages/zimbucknews) and in the Zimbuck Market News group (https://zimbuck.com/groups/zimbuckmarketnews), and read the full GBP/USD preview at the source linked in the References below. For related reading, see the EUR/USD beginners guide, linked in References. Join the conversation on Zimbuck (https://zimbuck.com) to say how you trade central-bank days — do you trade the decision, the vote split, or sit them out entirely? This article is market news and general information only, not financial advice.
