In focus – Bank of England: First to hike, last to pause and pivot

In focus – Bank of England: First to hike, last to pause and pivot

The Bank of England has increased interest rates by 25 basis points as anticipated. However, it will face the challenge of dealing with higher-than-anticipated inflation in the future. In March, inflation reached 10.1% in the UK, which was higher than any other Western European nation, as well as the United States. Inflation is expected to decrease to 4% by Q4 2023 due to declining food prices, stabilizing supply chains, and negative base effects from energy costs. By the conclusion of 2024, inflation is projected to be at 2.5% year-over-year, but this will still be 0.5% higher than the United States’ inflation rate.

Learn more here: https://www.allianz.com/en/economic_research/publications/specials_fmo/bank-of-england.html