12:15 - 1.08.2024

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August 1, Fineko/abc.az. The Bank of England may lower the base interest rate following the meeting on August 1 by 25 basis points, to 5% per annum, many economists believe.

If the forecast comes true, the rate cut will be the first since 2020. Meanwhile, market participants estimate the probability of such an outcome at 45% and are inclined to believe that the rate will be kept at the same level of 5.25%.

Inflation in the UK has been at 2% for two months, corresponding to the target value of the Bank of England.

At that, prices excluding the cost of food, alcohol, tobacco and energy (core inflation, CPI Core index) increased by 3.5% in annual terms in June, as well as a month earlier. Inflation in the service sector is also a concern - it is 5.7%.

A positive signal, from the point of view of the central bank, is the slowdown in wage growth in March-May to 5.7% from 5.9% in February-April. In addition, unemployment in the UK is at 4.4%, slightly higher than the Central Bank expected.