Bank of England Signals Its Rate-Cutting Cycle May Be Nearing an End

According to a report by Jinse Finance, the Bank of England has reiterated its guidance to take a gradual and cautious approach to further reducing borrowing costs. However, it has added a new signal in its outlook, suggesting that its rate-cutting cycle may be nearing an end. The Bank of England stated, "As interest rates are lowered, the restrictiveness of monetary policy has decreased," no longer directly indicating that policy remains restrictive. The Bank also reaffirmed that there is no predetermined path for interest rates. Halting the rate-cutting process would be a setback for Chancellor Reeves and Prime Minister Starmer, who have been striving to fulfill their promises to voters and accelerate the UK's sluggish economic growth. Bailey noted that the decision to cut rates for the fifth time since last August was "very finely balanced," although he believes rates are still on a downward trajectory.