HSBC accelerates UK rate hike timetable after BoE surprise

LONDON (Reuters) - HSBC on Friday ramped up its forecasts for UK interest rate increases in a 2022, a day after the Bank of England surprised markets by hiking rates by 15 basis points.

Among the first major investment backs to publish its changed forecasts, HSBC said it now expects three rate hikes in 2022 -- in February, May and August with a 0.25% change each time.

Its previous forecast were for two rate hikes in 2022 and one in February 2023, taking the main policy rate to 0.75%.

The new forecast profile also assumes that the central bank will begin winding down its balance sheet from February in a process called "quantitative tightening."

The BoE stunned markets on Thursday by raising interest rates by 15 bps to 0.25% sending gilt yields, bank stocks and the British pound shooting higher.

(Reporting by Saikat Chatterjee; editing by Dhara Ranasinghe)