BofA Alters Rate Hike Forecast Amid Economic Shifts

Bank of America Global Research has revised its outlook for the Bank of England, retracting its previous forecast for rate hikes in 2026. Driven by lower energy prices and easing inflation, the BofA now predicts a stable interest rate for 2027, with one minor cut in November.

Bank of America Global Research revised its interest rate forecast for the Bank of England, shifting from a prediction of hikes to a more conservative stance. The change reflects declining energy prices, reduced inflation, and a softer economic climate.

The brokerage had initially predicted two rate increases for 2026 and anticipated more aggressive adjustments. Now, it envisions a single 25-basis-point cut in November 2027, highlighting uncertainties amid easing inflation risks.

Amid global central banks’ actions and recent economic data, traders still forecast a potential rate hike by year-end. Such an outlook shows how dynamic economic landscapes can swiftly alter financial strategies.