UBS Expects Bank of England to Hold Rates at 3.75% Through 2026

UBS Global Research strategists said the Bank of England may keep its policy rate unchanged at 3.75% for the rest of 2026. According to Jin10, the strategists wrote in a report that maintaining rates at the current restrictive level would allow the central bank to respond to any second-round effects that could arise from inflation. They added that the likelihood of the Bank of England raising rates appeared low, citing a weak starting point for the economy, including the labor market. UBS said it still expected the next policy move to be rate cuts in February 2027 and April 2027.