The Bank of England voted by a majority of 8-1 to raise the key bank rate by 25bps to 4% in November 2026, in line with expectations. It is the first increase in borrowing costs since August 2023, with one policymaker, Catherine Mann, voting for a hike of 0.5 percentage points to 4.25%. UK inflation is now expected to rise to around 5% by the middle of next year from the current 3.5%. It is then projected to fall as the impact of rising energy prices fades, and still restrictive monetary policy bears down on inflation. In addition, activity data in recent months have generally been stronger than expected, adding to the case for modestly tighter monetary policy. Policymakers added that monetary policy is not on a pre-set path and the Committee will continue to assess the evidence at each meeting and will adjust Bank Rate as necessary to ensure CPI inflation returns to the 2% target in the medium term.

Bitcoin fell below $76,600 on Thursday, reaching its lowest level in around eight weeks as a sharp selloff in technology stocks spread to other risk-sensitive assets, further weakening sentiment across cryptocurrency markets. The Nasdaq 100 plunged, led by semiconductor companies facing disappointing earnings outlooks and concerns that Democratic control of Congress could bring tighter regulation of the artificial intelligence industry. These developments have increased investor caution towards technology-related investments, spilling over into digital assets. Meanwhile, cryptocurrencies are already facing industry-specific headwinds, including the fallout from the Binance hack and fading retail investor interest. The renewed volatility in technology shares has added to these pressures, offsetting the potential support from easing US Treasury yields, which would normally improve the appeal of speculative assets.

The yield on the US 10-year Treasury note fell to 4.83% on Thursday, hovering near two-month lows, as a sharp equity market sell-off triggered a flight to safety. Investors continued to scale back exposure to technology stocks amid concerns over the potential implications of a Democratic blue wave for AI and data centre investment. Following the midterm election results, the 10-year yield had already declined by around 8bps in the previous session. Meanwhile, investors are turning their attention to Friday’s US jobs report for further clues about the health of the labour market. Recent data painted a mixed but relatively resilient picture, with private businesses adding 86K jobs in October, according to ADP, while initial jobless claims fell to their lowest level in 57 years. In addition, third-quarter productivity growth came in stronger than expected. Against this backdrop, markets are pricing in an approximately 75% probability of a 25bps Fed rate hike next month.

Initial jobless claims in the US fell by 6,000 to 189,000 in the final week of October, below market expectations of 196,000 and down from a revised 195,000 in the previous week. The reading matched the 57-year low recorded in mid-July, pointing to continued labor market resilience despite mounting economic headwinds. Robust corporate profits and resilient domestic demand are helping limit layoffs, while employers remain cautious about staffing changes amid uncertainty over the Iran war, elevated energy costs, Fed policy and trade policy. Meanwhile, continuing claims increased by 23,000 to 1.718 million in the week ended October 24.

US nonfarm business sector labor productivity climbed by 3.6% in the third quarter of 2026, marking the strongest increase since Q3 2025 and comfortably beating expectations of a 2.8% rise. The figure also marked an acceleration from the upwardly revised 2.1% gain in Q2. The improvement was driven by a 3.7% increase in output, while hours worked rose just 0.1%, pointing to stronger production relative to labour input. In the manufacturing sector, productivity rose 0.3%, as a 2.2% increase in durable goods productivity was partly offset by a 1.7% decline in nondurable goods. Durable goods productivity benefited from a 3.8% increase in output against a 1.6% rise in hours worked, while nondurable goods output fell 1.6% and hours worked increased 0.1%. Compared with the same quarter a year earlier, nonfarm business productivity grew by 2.1%.

Crude oil prices rose for the first time in four sessions on Thursday, climbing to around $90 a barrel after plunging more than 8% to a near two-month low in the previous session. Traders continue to assess whether the Democratic sweep of Congress in the US midterm elections could improve prospects for a diplomatic resolution to the war with Iran. US Vice President JD Vance said voter frustration over the conflict and the US relationship with Israel had contributed to the Republicans' electoral defeat. Ahead of the election results on Tuesday, President Trump said he had no immediate plans to escalate military strikes. Nevertheless, geopolitical risks to supply remain elevated despite a recovery in exports from Gulf producers. Adding to concerns, Iran's Islamic Revolutionary Guard Corps said on Thursday that two oil tankers and a tugboat had caught fire in separate incidents after allegedly attempting to navigate unauthorised routes through the Strait of Hormuz.