Institutions: Bank of England Expected to Cut Interest Rates by Another 75 Basis Points This Year

Pantheon Macroeconomics Chief UK Economist Robert Wood stated that the forecast for UK economic growth in 2025 and 2026 has been revised downwards, with GDP now expected to grow by 0.9% and 1% in 2025 and 2026, respectively, lower than the previous forecasts of 1.1% and 1.5%. Although the inflation rate fell to 2.6% in March, it is expected to rise significantly in the coming months, potentially reaching 3.4% in the second quarter and only dropping to 3.3% by the end of the year. Most of the data since the last forecast assessment would typically lead the MPC to maintain an absolutely cautious stance. However, President Trump's tariffs have already disrupted the global economy and unsettled financial markets. In this context, Pantheon Macroeconomics expects the Bank of England to implement three more 25 basis point rate cuts this year, including consecutive cuts in May and June, and a final cut in November. (Jin10)