UBS Expects Bank of England to Hold Rates at 3.75% Through 2026, Resume Cuts in February 2027

According to UBS strategists, the Bank of England is likely to maintain interest rates at 3.75% for the remainder of 2026, according to a report on June 30. The strategy team expects the central bank's next policy moves to be rate cuts in February and April 2027, respectively. UBS noted that holding rates at the current restrictive level will help address potential secondary effects from inflation, and cited weak economic conditions and labor market softness as reasons why BOE rate hikes remain unlikely.
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