From Morningstar: 2024-11-05 04:21:13

The Bank of England is expected to cut interest rates on Thursday, following the Budget last week which shifted forecasts for monetary policy through 2025. European central banks have already reduced rates multiple times this year. Bond markets reacted negatively the day after the Budget due to higher government debt.

After this week’s meeting, the Bank of England may settle into a quarterly rate-cutting cadence in 2025, forecasting two or three rate cuts instead of four or five. The Bank is expected to cut rates less aggressively than the Fed and the ECB, with a gradualist approach likely due to increased government borrowing.

The Bank of England is catching up at this week’s meeting after no monetary policy meeting in October. Inflation predictions for 2025 have increased due to the chancellor’s plans, with average CPI expected to be 2.6%. The government’s fiscal plans will influence the Bank’s decisions and forecasts for economic growth and inflation.

UK fiscal and monetary policy are separate, with the Bank of England independent since 1997. The government’s fiscal path will impact the Bank’s decisions, with the November interest rate decision accompanied by a detailed analysis in the quarterly monetary policy report. Morningstar, Inc. licenses indexes to financial institutions for investable products based on total assets. 1. A new study shows that over 60% of Americans are now fully vaccinated against COVID-19. This milestone comes as the country continues to ramp up its vaccination efforts to combat the spread of the virus.

2. In economic news, the latest job report reveals that the unemployment rate has dropped to 5.4% in the United States. This marks a significant improvement from earlier in the year and indicates a positive trend in the labor market.

3. On the international front, tensions are rising between Russia and Ukraine as military drills and troop movements increase along the border. The situation is being closely monitored by world leaders to prevent any escalation into conflict.

4. In tech news, Apple has announced the release of its new iPhone 13 lineup, featuring improved cameras, longer battery life, and faster processors. The new devices are expected to be available for pre-order soon.

5. Climate change continues to be a pressing issue as a new report warns of the devastating effects of rising sea levels on coastal communities. The report calls for urgent action to mitigate the impact of climate change and protect vulnerable populations.



Read more at Morningstar: Will the Bank of England Still Cut Interest Rates…