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Better inflation data gives Bank of England more scope to cut interest rates

  • Writer: Conrad Binding
    Conrad Binding
  • Oct 21, 2024
  • 1 min read


  • New inflation data showed the current rate is 1.7% (on the CPI measure). Inflation being back under target gives the Bank of England more scope on interest rates.

  • There are some elements that are still causing concern. The part of inflation that is proving ‘sticky’ is service inflation which remains high at 5.6%.

  • Goods inflation is much lower and indeed negative at -1.4%. This is actually the largest negative rate for goods inflation since August 2016.

  • Despite some stickiness in parts of the inflation data there is still scope for the Bank of England to cut interest rates.

  • October consensus forecasts showed expectations are for an average Bank rate of 4.7% by end Q4 2024. The next meeting is November 7th. Source: Dataloft by PriceHubble, ONS, HM Treasury Consensus Forecasts

 
 
 

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