Four factors dictating the paths of US and UK interest rates

Interest rates on both sides of the Atlantic have been at record lows for six and a half years, but after a great deal of speculation and opaque pronouncements from central bankers, a hike now feels very close indeed. Many investors expect the US Federal Reserve to raise its Fed Funds Rate band by 25 basis points at its September meeting, or failing that, in December. The Bank of England is likely to follow up that decision with an identical increase of its own soon after. After that, however, we believe the monetary policies that have been in relative lock-step for the better part...