Housing Unpacked Fighting the Last War: Markets, Mortgages and the Bank of England’s Hawkish Misfire
Mar 25, 2026
Michael Brown, a market strategist at Pepperstone who analyses rates, swaps and geopolitics. He discusses the Bank of England’s surprising hawkish signal and how it sent swap rates soaring. He talks about Middle East conflict fallout, energy routes shaping inflation, and why mortgage fix choices and UK borrowing costs now hinge on fast‑moving geopolitical and market shocks.
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Energy Market Disruption Will Linger Long After A Ceasefire
- Even if hostilities pause, commodity and LNG markets will take years to normalize because of stranded tankers and damaged infrastructure.
- Qatar warned Ras Laffan damage could take three to five years to restore full LNG output.
Bank Of England's Hawkish Signal Reshaped Markets
- The Bank of England signalled heightened concern about second‑round inflation effects and said it will act as appropriate.
- That 9–0 unanimous hold and explicit warning pushed markets from pricing cuts to pricing multiple hikes within weeks, reshaping expectations.
Hawkish Language Multiplied Market Volatility
- The BOE's aggressive messaging amplified market moves because traders were forced to close positions, creating a spiral in swap and gilt yields.
- Technical market positioning combined with the hawkish tone produced a rapid repricing of rate expectations.