HSBC Holdings PLC (LSE:HSBA) analysts reckon the Bank of England could lower interest rates to as low as 2.75% next year.
The prediction comes after BoE policymakers held rates at 5% at yesterday’s Monetary Policy Committee (MPC) meeting.
HSBC expects rate cuts at every MPC meeting from February 2024 onwards, beginning with a potential cut this November.
“Part of the slightly better medium-term growth outlook reflects monetary policy,” said HSBC analysts.
“With most indicators pointing to a cooling in the labour market, we and BoE have become more confident that the worst of the inflation pressures – and the risk of them becoming entrenched – is behind us.”