Overview
- The Bank Rate stands at 3.75% after December’s move, with the BoE projecting headline inflation to fall closer to 2% by April.
- Swiss lender Lombard Odier’s Bill Papadakis projects a drop to 2.75% by the end of the third quarter, citing rising unemployment, slowing wage growth and easing services inflation.
- Money markets are more cautious, pricing roughly two cuts this year and a year‑end rate near 3.5%, with some pricing pointing to mid‑year moves.
- Deutsche Bank maintains a call for two cuts in March and June to 3.25%, while Oxford Economics also sees two moves in 2026 ending at 3.25% and Capital Economics points to about 3%.
- ONS data show unemployment above 5% in the three months to October and private‑sector pay growth down to 3.9%, reinforcing arguments for policy easing.