The Bank of England may implement an interest rate cut by a quarter-point this year and possibly again next year as inflation remains a concern. Current inflation stands at 3.6%, with expectations to peak at 4.0%. Economists mention mixed signals regarding inflation and wage growth that may influence monetary policy. The prediction includes potential continued disagreements within the Monetary Policy Committee regarding interest rate decisions. Some economists believe the UK economy shows resilience, which may lead to maintaining the current rates longer than anticipated.
"Right now the Bank of England is really on a knife-edge in terms of whether it wants to cut interest rates further. We think the disinflationary momentum, particularly in the wage data, will be just about enough to tip the MPC into cutting rates in November."
"If we see indicators of inflation expectations being even more uncomfortably elevated than they are... it would increase the risks of the majority of the MPC opting to pause for the time being."
Collection
[
|
...
]