Markets pencil in UK interest rate rise in days before Christmas

Forecasts of early increase come as series of indicators show strains on industry and big fall in consumer confidence

Traders are betting that Bank of England policymakers are likely to begin raising interest rates as early as December in response to fuel and food shortages that are expected to push up inflation before Christmas.

Financial markets have brought forward their forecasts for interest rate rises, judging a 0.15% increase in the central bank's base rate a certainty in the days before Christmas. The increase is in addition to two 0.25% rises earmarked for next February and August that will push borrowing rates by the end of 2022 back to the 0.75% level seen before the pandemic.