Business-Insider

Bank of England Rate Decision (11:00 GMT; 7:00 EST)
Expected: 5.50%
Previous: 5.50%

How Will The Markets React?
There have already been three interest rate decisions so far this week.
The Reserve Bank of Australia didn't surprise anybody last night when
Governor Glenn Stevens announced the policy group was keeping the nation's overnight cash rate unchanged at 6.25 percent.

A little later in the day, the European Central Bank's meeting concluded in the same lack of surprise for the markets, though the decision itself made a few more waves as the benchmark rate for the region was lifted 25 basis points to 4.00 percent.

Finally, the Reserve Bank of New Zealand took that last step by overriding the consensus among economists and hiking its own OCR to a nine-year high 8.00 percent. With all this activity perking speculation and testing historically low levels of volatility, traders now turn a more watchful eye on the Bank of England's own rate decision.

Both the market and economists are expecting policy officials to leave rates untouched at 5.50 percent. This outlook is backed by a number of data highlights that suggest the Monetary Policy Committee will hold its hand in order to gauge whether past efforts to cool growth and inflation are taking effect.

For growth, economic expansion cooled only slightly in the first quarter from a 3.0 percent pace to 2.9 percent, though this was enough to record the first deceleration in seven quarters. Perhaps more pressing though was the pull back in analysts? preferred inflation gauges. The annual consumer price index for April fell back from its decade high 3.1 percent gait in April as the retail price index stepped back from its equally hot 4.8 percent pace.

On the other hand, these levels are still well above the BoE's tolerance band.
What's more, this is the first meeting since a 9-0 vote for a hike in May which followed a letter from Governor King to Chancellor Brown to address what is being done to rein in rampant price growth. So will this meeting turn out to be more like the RBA's or RBNZ's rate decision?
Only time will tell, but speculation will happily fill the void until then.

Analisys by DailyFX