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The Bank of England is expected to deliver its second interest rate cut of 2024 at the
monetary policy committee’s meeting next week, The Times reported on Friday evening.
The BoFE is expected to cut the base rate by a quarter of a percentage point to 4.75% on Thursday, with market participants betting on ‘a clear eight to one majority’.
However, investors have ‘pared back’ expectations of a further cut before the end of the year after Chancellor Rachel Reeves announced the government’s Budget. This included £40 billion in tax rises and £30 billion in additional borrowing.
‘At its September meeting, the Bank of England’s guidance set the stage for another reduction in Bank Rate. Since then, key barometers of inflation’s stickiness - services inflation and pay growth - have continued to fall back more quickly than the MPC had previously forecast,’ commented forecaster the EY Item Club’s Matt Swannell.
‘On balance, these positive developments should give most of the MPC the confidence to dial back bank rate a little further.’
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