Societe Generale forecasts UK rates unchanged as services inflation and labor market loosening reduce immediate hike pressure.
The Bank of England is expected to maintain its benchmark rate at 3.75% through 2026, according to recent analysis. Easing services inflation and a loosening labor market support the central bank’s cautious stance, reducing urgency for further tightening.
Prior expectations had leaned toward potential rate cuts sooner, but persistent underlying inflation concerns have shifted the outlook. The current forecast aligns with a wait-and-see approach, balancing inflation risks against economic growth.
Markets have adjusted expectations, pricing in prolonged stability at current levels rather than near-term adjustments.