Traders39; peak BoE rate bets surge while Fed, ECB39;s stable
Unclear BoE communication hurting UK debt investors
Fed, ECB messaging seen as much clearer than BoE39;s

July 17 Reuters As markets navigate a likely end to the steepest interest rate rises in decades, investors say the Bank of England has been less consistent in its messaging than other major central banks, making positioning in UK assets a particular challenge.

Traders, who bet the BoE was nearly done in May, now price in over 100 basis points of further hikes. U.S. Federal Reserve and European Central Bank expectations have meanwhile risen only marginally.

For investors, clear communication from central bankers is crucial as they transmit their policy to borrowing costs through markets.

The BoE was the first major central bank to start hiking rates. But investors said a lack of clarity was now a reason behind still surging UK borrowing costs and volatility at 40year highs.

Britain39;s 10year bond yield has jumped almost 80 bps this year while the U.S. and German equivalents have fallen.

The UK clearly has shown what happens if your communication as a central bank is a little bit ambivalent or ambiguous, said BNY Mellon Investment Management chief economist Shamik Dhar.

The gilts repricing has partly come about because of the Bank of England39;s past reluctance to suggest that rates might get this high, Dhar, a former BoE economist, said.

Investors say the BoE, tackling the highest G7 inflation…