{"id":118318,"title":"Traders Anticipate Only Two Interest Rate Cuts by Bank of England in 2025","publisher":"Share Talk","author":"sharetalk","published":"2024-12-18T10:05:31+00:00","modified":"2024-12-18T10:05:31+00:00","canonical_url":"https://www.share-talk.com/traders-anticipate-only-two-interest-rate-cuts-by-bank-of-england-in-2025/","markdown_url":"https://www.share-talk.com/traders-anticipate-only-two-interest-rate-cuts-by-bank-of-england-in-2025.md","json_url":"https://www.share-talk.com/traders-anticipate-only-two-interest-rate-cuts-by-bank-of-england-in-2025.json","category":"B2B","categories":["B2B","Blogs","Exclusive Interviews","Technology","Technology, Media & Telecoms"],"tags":["BANK","Bank of England","banking","BARC","Barclays","Benchmark","BoE","buyback","Chancellor","childcare","CME Group","consumers","Coverage","CS Venkatakrishnan","domestic","energy bill","England","FCA","Fed","Federal Deposit Insurance Corporation","Federal Reserve","FREE","FTSE 100","FTSE 250","FTSE100","futures","Goldman Sachs","household","HSBC","HSBC Holdings","Inflation","investors","Jeremy Hunt","Legal & General","lending","Lloyds Banking Group","London","midcap index","NatWest Group","Ofgem","pandemic","price cap","Prime Minister","program","Prudential","Qatar","Regulators","Rishi Sunak","SEC","Serious Fraud Office","share","Share Talk","ShareHolders","silicon valley","Silicon Valley Bank","SIVB","SVB","The Bank of England","Traders","Treasury","UK","Underground","USA","Wall Street"],"featured_image":"https://i0.wp.com/www.share-talk.com/wp-content/uploads/2023/11/Bank-of-England-20_11_23.jpg?fit=1200%2C800&quality=89&ssl=1","format":"news","language":"en-GB","content":"Traders are forecasting that the Bank of England (BoE) will implement just two interest rate cuts next year, following an expected rise in inflation to 2.6%.\n\nAfter the latest inflation data, money markets indicate that investors have slightly adjusted their expectations for rate reductions. This adjustment comes after bond traders reacted strongly to Tuesday’s employment figures, which revealed wages increasing faster than anticipated.\n\nOn Tuesday, the yield spread between UK and German bonds reached its widest since 1990, heightening concerns that the UK may be entering a stagflation period characterized by high inflation coupled with low economic growth.\n\nDerivatives trading suggests that the market now expects only two interest rate cuts in 2025, down from the three cuts that were fully priced in by the end of last week.\n\nThe Bank of England is expected to maintain current interest rates during its upcoming meeting on Thursday, following a second rate reduction last month.\n\nJeremy Batstone-Carr, a strategist at Raymond James, commented on the situation: “Given the weak economy, the Bank will likely be inclined to provide support where possible. However, policymakers will only proceed with rate cuts if inflationary pressures sufficiently ease, ensuring that easing monetary policy does not reignite inflation.”"}