BOE More Likely to Cut Rates than Raise Them

Dow Jones
07/30

1230 GMT - Although the Bank of England continued to signal the possibility of raising interest rates Thursday, this looks unlikely, Capital Economics economist Paul Dales says. The BOE expects inflation to reach a peak of 3.2% in the fourth quarter before falling below 2.0% at the start of 2028. Capital Economics expects inflation to peak at 3.5% but sees it falling quicker to 2.0% by the end of 2027. "That's why we don't think interest rates need to rise," Dales says. "In fact, if we're right, interest rates may be cut to 3.00% in 2027." The BOE voted 6-3 to leave rates at 3.75%.

 

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