Bets on a 2019 BoE rate hike drop on Brexit uncertainty

FILE PHOTO: People walk past the Bank of England in London, Britain. Aug 24, 2018. REUTERS/Simon Dawson

LONDON (Reuters) - Interest rate swap markets have cut expectations of a quarter-point rate hike from the Bank of England by the end of 2019 to 52 percent on Wednesday, compared to a previous 64 percent expectation.

The latest leg down in market expectations of a rate hike comes after overnight political developments that has sown fresh uncertainty for the British economy in the near term.

Lawmakers demanded that Prime Minister Theresa May return to Brussels to replace the so-called Irish backstop, an insurance policy that aims to prevent the reintroduction of a hard border between Ireland and Northern Ireland, potentially putting her on a collision course with the European Union.

(This story was refiled to fix date in first paragraph.)

Reporting by Saikat Chatterjee; Editing by Sujata Rao