UBS: Bank of England rate cut fails to conceal disagreements among policy makers

UBS Global Wealth Management economist Dean Turner pointed out in a report that although the decision of the Bank of England to cut the key interest rate to 3.75% largely met market expectations, the rate cut has a hawkish tone, and the vote was passed with a slim majority of 5 votes in favor and 4 votes against. He stated that there are still divisions among policymakers, and given the evidence that there may be sticky inflation in the coming months, this is not surprising. This means that the Bank of England may need some time to achieve the 2% inflation target. "We expect the Bank of England to cut rates again at the next meeting in February, when they will have a new set of forecast data that may support their continued cautious approach to the extent and speed of rate cuts," Turner said. However, UBS also predicts that the Bank of England will only cut rates once again in 2026.