Daily Financial Breakfast 5 November 2026: 4% as BoE Lifts Rates; Brent Drops Over 10% Following U.S. Elections

Market News Today: Key Figures and Developments

• 25 basis points was the Bank of England’s policy rate increase. The move took the rate to 4%, its first rise since 2023.
• More than 10% was wiped off Brent crude, taking it to $93 a barrel after Democrats secured both chambers of Congress. Gold climbed above $4,050.
• 4.0% was the euro area’s October inflation reading. ECB Governing Council member Ante Zigman put the likelihood of another December rate increase at a high level.
• Minutes from the Bank of Japan’s September meeting recorded agreement among members that further policy interest rate increases remained appropriate.
• Should price stability come under threat, the Swiss National Bank would adjust policy without hesitation, Chairman Martin Schlegel said.
• Higher interest rates were manageable for banks, according to Banque de France Governor Emmanuel Moulin, who also urged France to restore its public finances.
• 70.49 million POL is the recovery target of a hard fork proposed by Polygon Labs. The tokens sit in five attacker-controlled addresses following the Polymarket and Binance hacks.
• Discussions among House Democrats concern a wider crypto market structure bill for the next Congress, according to crypto journalist Eleanor Terrett.

Markets in Focus

Currency Moves

$1.3503 marked sterling’s seven-week high on Wednesday. The currency then slipped below $1.35, trading around $1.3485 during Thursday’s Asian session before recovering towards $1.3500 following the Bank of England decision. Against the euro, sterling showed little change. Before the decision, it had lost 0.16% against the yen to trade near 212.93. Early Asian dealing saw the euro climb to about $1.1245. On Wednesday, the Australian dollar bounced from two-week lows; on Thursday, the U.S. Dollar Index recouped some earlier losses.

UK Interest Rate Policy

4% Bank of England Rate Follows First Rise Since 2023

At Thursday’s November meeting, a widely expected 25 basis point increase took the Bank of England’s policy rate to 4%. It was the bank’s first rate rise since 2023.

With inflation forecast to approach 5% by mid-2027, Governor Andrew Bailey kept further tightening on the table. Additional monetary tightening was also advocated by some policymakers.

After the announcement, Bailey rejected the view that the bank had moved too late. The latest decline in oil prices was welcome news, he said.

U.S. Election Results & Global Market Moves

Democratic Congress Win Sends Oil Lower, Gold Higher

Republican control of Congress under President Donald Trump ended as Democrats captured the U.S. House of Representatives and Senate in the midterm elections. Markets responded with a sharp oil decline, a gold rally and initial dollar weakness.

A fall of more than 10% took Brent crude to $93 a barrel, below $100 for the first time since October 7, according to Rabobank. Following a 9% slide on Wednesday, WTI stayed near a one-month low during Thursday’s Asian session, then traded at around $86.40 in early European hours. No clear immediate catalyst was identified for Wednesday’s WTI drop. Reports associated the sell-off with hopes that the election outcome could help end the Iran war, not with any confirmed shift in U.S. policy.

After bouncing from a daily low of $3,919, gold traded at $4,047 on Wednesday, up nearly 3%. By early Asian trading on Thursday, it had reached about $4,065. The advance exceeded 3.60%, making it the largest gain since mid-August.

Global Price Pressures & Central Bank Policy

4% Euro Area Inflation; ECB’s Zigman Signals Likely December Rise

October’s euro area annual inflation rate climbed to 4.0%, a three-year high, compared with 3.8% in September. The core reading held steady at 2.5%.

Price increases were spreading beyond energy across the consumer basket, Commerzbank economist Vincent Stamer said. At nearly 3%, the three-month annualised core inflation rate was already higher than the year-on-year figure, he noted.

Excluding Ireland, euro area GDP growth stood at 0.2%, according to Standard Chartered economist Christopher Graham. On that measure, growth momentum had weakened steadily since the fourth quarter of 2025. The October inflation figure also surpassed the ECB’s September forecast for fourth-quarter average inflation of 3.6%.

Bloomberg reported that ECB Governing Council member Ante Zigman saw a high probability of another interest rate rise at the December meeting.

BoJ Minutes Record Support for Further Rate Rises

Minutes released on Thursday showed that Bank of Japan board members considered continued policy interest rate increases appropriate at their September meeting. Rather than announcing a fresh rate decision, the record set out members’ assessments of the monetary policy outlook.

SNB’s Schlegel Pledges Policy Response to Price Stability Risks

An above-forecast October inflation reading had intensified inflationary pressures, Swiss National Bank Chairman Martin Schlegel said on Wednesday. He added that the central bank would act without hesitation to change monetary policy if price stability came under threat.

ECB’s Moulin Sees Banks Coping With Higher Rates, Urges French Fiscal Repair

Rising interest rates were within banks’ capacity to manage, Banque de France Governor Emmanuel Moulin said on Wednesday. Also a member of the ECB’s Governing Council, Moulin urged France to put its public finances in order.

Digital Asset Markets & Regulatory Developments

70.49 Million POL Targeted in Polygon Labs Hard Fork Proposal

To recover assets associated with the Polymarket and Binance hacks, Polygon Labs put forward a hard fork of the Polygon Proof-of-Stake mainnet. Under the proposed one-off governance action, validators would have to move tokens out of five attacker-controlled addresses and into verified recovery addresses.

The 70.49 million POL total comprises 23.86 million POL associated with Polymarket and 46.63 million POL associated with Binance. In its investigation of the October 30 security incident, Polymarket identified roughly 28 million POL on Polygon PoS. Approximately 24 million POL of that amount were later frozen upon request.

Although block producers have added the five addresses to the Bor transaction block list, the mechanism has constraints. Producers load the list only when starting up, meaning updates depend on restarts or span rotations. Entries have no automatic expiry, and only certain transaction types fall within the filter’s scope. Transfers are blocked by the current arrangement, but it offers no means of returning the assets.

Discussion of the proposal was scheduled for Thursday. If approved, implementation would take roughly two weeks under the proposed timeline.

Broader Crypto Bill Under Discussion by House Democrats, Terrett Reports

In a Wednesday post on X, crypto journalist Eleanor Terrett reported that House Democrats were considering plans for a wider cryptocurrency market structure bill in the next Congress. Following the Democrats’ midterm election victories, these discussions remain proposals rather than enacted legislation.

According to Terrett, the proposal would build on Representative Maxine Waters’ Crypto Investor and Consumer Bill of Rights. That amendment was introduced while the House was considering the Digital Asset Market Clarity Act. Wider SEC oversight of crypto markets and tougher ethics restrictions on Trump and other federal officials feature in the reported plans.

The effort would aim to bring together Democratic provisions rejected by the House and measures negotiated by Senate Democrats with Republicans before the CLARITY Act failed to progress in September.

Key Events Ahead

• October U.S. Nonfarm Payrolls Report (6 November 2026): Friday is the scheduled release date for the October U.S. nonfarm payrolls report.