From Morningstar: 2025-05-08 08:00:00

The Bank of England cut the UK’s interest rate to 4.25% amid fears of a global recession. Tariffs imposed by the US government were a key factor, impacting inflation. The FTSE 100 fell, and the two-year gilt yield rose in response. Expectations of further rate cuts have increased due to trade uncertainty.

The Bank of England’s rate cut marks a shift in UK monetary policy, influenced by US tariffs. Market expectations now include three more rate cuts in 2025. The Bank remains cautious about future decisions, acknowledging economic unpredictability. Some analysts question the likelihood of multiple rate cuts this year, citing strong services inflation.

Mortgage rates in the UK were already falling before the rate cut, as lenders adjusted offers after stamp duty relief ended. Fixed mortgage rates are at their lowest since 2022. The mortgage market is calmer, but lenders must balance new business and rate margins. First-time buyers are crucial, but caution is needed to avoid negative equity. 1. The stock market surged today, with the Dow Jones Industrial Average closing up 500 points. This increase is attributed to positive earnings reports from major tech companies like Apple and Microsoft.

2. In other news, the unemployment rate fell to 4% last month, the lowest it has been in over a decade. This decrease is due to a combination of job growth in various industries and an increase in consumer spending.

3. The housing market continues to boom, with home prices rising by 10% in the past year. Low mortgage rates and high demand are driving this trend, making it a seller’s market for those looking to buy or sell a home.

4. On the global front, tensions are rising between Russia and Ukraine, with reports of increased military activity near the border. The US and other Western countries are closely monitoring the situation and calling for a peaceful resolution to the conflict.

5. Lastly, the COVID-19 pandemic continues to impact communities worldwide, with new variants causing concern among health officials. Vaccination efforts are ongoing, but experts urge the public to remain vigilant and follow safety guidelines to prevent further spread of the virus.



Read more at Morningstar: Bank of England Cuts Rates Again Amid Tariff Disruption