The nine members of the Bank’s Monetary Policy Committee (MPC) are expected to vote unanimously by the market for a 0.75 point increase in its key rate. It would be its seventh and biggest rate hike this year, with September’s 0.5 point hike being the biggest yet.

The last time the Bank’s policy rate was 3% was at the height of the global financial crisis.

Although consumer price index inflation is currently at 10.1% and is expected to rise, economists expect a slowdown in commodity prices, the scrapping of the regime’s mini-budget Truss and support measures such as government energy price caps to slow and reverse its growth.

This would reduce the need for MPC to continue to aggressively raise its base rate.

Pantheon Macroeconomics chief UK economist Samuel Tombs noted that MPC board member Ben Broadbent hinted earlier this month that it would not reach 5.25%, as feared by the markets.

“We expect the MPC to raise the Bank Rate by 75 basis points this week, but signal smaller increases in future meetings,” he said.

Fabrice Montagne, head of Barclays UK and senior European economist, agreed: “We expect the BOE to rise 75 basis points at its November meeting, partly on strong inflation/ wages, but also in response to some fiscal easing.”

But Goldman Sachs’ chief European economist, Sven Jari Stehn, disagreed. “We expect a 75 basis point hike in November and December, and that’s because you have significant underlying inflationary pressures,” he said. “The labor market is very tight.”

“We believe the Bank will respond by accelerating the pace of the hike. We no longer believe it needs to be as aggressive as expected after the mini-budget.”

Confidence among small business owners has fallen to its lowest level in two years, according to specialist lender Novuna Business Finance.

He said 31% of small businesses expect growth this quarter, compared to 37% for the same period last year when the UK was still suffering from Covid-19 restrictions.

Last quarter, 34% of small businesses believed they would grow.

Novuna also said 18% of small businesses believe they will either shrink or struggle to stay afloat over the next three months.

Jo Morris, head of insight at Novuna, said: “We are all aware of the economic challenges everyone is facing as we head into autumn and winter.

We weren’t surprised to see a drop in the proportion of small businesses anticipating growth as Christmas approached.”