(Bloomberg) -- The pound may come under pressure if the Bank of England doesn’t deliver a half-point increase this week, according to bank strategists.

Most analysts expect the BOE to raise rates by 50 basis points on Thursday, but there’s growing speculation that the central bank may only raise rates by 25 basis points in an effort to shield the economy.

ING Groep NV analysts including Francesco Pesole said limited tightening from the BOE could sting the pound given that the Federal Reserve and other central banks have been raising rates more aggressively. The currency has rebounded in the past two weeks, climbing above $1.22 after months of relentless selling.

A 25 basis-point increase “could trigger some weakness in the pound,” they wrote, adding that the currency may dip to $1.20 or 83 cents against euro.

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Author: Naomi Tajitsu