BofA Global Research drops BoE rate hike forecast on easing inflation | PiQ Markets
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BofA Global Research drops BoE rate hike forecast on easing inflation
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IN SHORT
BofA Global Research has withdrawn its forecast for the Bank of England to raise interest rates this year, citing easing inflation and a softer economic outlook. The firm now anticipates rates will remain steady, with a single 25-basis-point cut expected in November 2027. In Brazil, mid-June inflation rose 0.41%, slightly below the 0.44% forecast, driven by food costs. Brazil's central bank projects inflation near its target by 2028.
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Key Numbers
0.41%Brazil mid-June inflation rate
0.44%Brazil mid-June inflation forecast
25-basis-pointanticipated Bank of England rate cut
Who's Involved
BofA Global Research
financial research firm forecasting interest rate changes
Bank of England
central bank whose interest rate policy is under review
Brazil's central bank
monetary authority projecting inflation targets
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Key facts
BofA Global Research withdraws its forecast for a Bank of England rate hike this year.
BofA Global Research cites easing inflation and a softer economic outlook for its forecast change.
BofA Global Research now expects Bank of England rates to remain steady.
BofA Global Research anticipates a single 25-basis-point rate cut by the Bank of England in November 2027.
Brazil's mid-June inflation rose by 0.41%.
Brazil's mid-June inflation was slightly below the forecast of 0.44%.
Food costs were the main driver of Brazil's mid-June inflation increase.
Brazil's central bank projects inflation near its target by 2028.
BofA Global Research has rescinded its prediction that the Bank of England will increase interest rates this year. This decision stems from observed easing inflation pressures and a more subdued economic outlook. Consequently, BofA Global Research now forecasts that interest rates will be held steady. A solitary 25-basis-point reduction in rates is anticipated, with the timing projected for November 2027.
In parallel developments, Brazil's inflation figures for mid-June have been released, showing a slight deceleration. The inflation rate for the period stood at 0.41%, which is marginally below the anticipated 0.44% forecast. The primary driver for this increase was attributed to rising food costs. Despite these near-term inflationary pressures, Brazil's central bank maintains a projection that inflation will converge towards its target range by the year 2028.
↳ Why This Matters
BofA Global Research has rescinded its prediction that the Bank of England will increase interest rates this year. This decision stems from observed easing inflation pressures and a more subdued economic outlook. Consequently, BofA Global Research now forecasts that interest rates will be held steady. A solitary 25-basis-point reduction in rates is anticipated, with the timing projected for November 2027.
Frequently asked questions
BofA Global Research previously forecast two rate hikes in 2026 and expected a single 25-basis-point cut in November 2027.
British inflation held at 2.8% in May, unchanged from April's 13-month low.
The Bank of England's current interest rate is 3.75%.
What Happens Next
01Traders anticipate at least one 25 bps rate hike by the Bank of England by year-end.
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