Markets React as Tensions Rise Between White House and Federal Reserve Over Interest Rate Pressure 
BOJ Holds Interest Rates Steady, Upgrades Growth and Inflation Outlook for Japan 
Bank of Canada Holds Interest Rate at 2.25% Amid Trade and Global Uncertainty 
Bank of Korea Expected to Hold Interest Rates as Weak Won Limits Policy Easing 
BOJ Rate Decision in Focus as Yen Weakness and Inflation Shape Market Outlook 
RBA Deputy Governor Says November Inflation Slowdown Helpful but Still Above Target 
ECB’s Cipollone Backs Digital Euro as Europe Pushes for Payment System Independence 
MAS Holds Monetary Policy Steady as Strong Growth Raises Inflation Risks 
China Holds Loan Prime Rates Steady in January as Market Expectations Align 
Fed Confirms Rate Meeting Schedule Despite Severe Winter Storm in Washington D.C. 
Bank of England Expected to Hold Interest Rates at 3.75% as Inflation Remains Elevated 
Upcoming BoE Announcement
The BoE will also announce the Monetary Policy Report and interest rate decision on February 6, and most economists predict that they will cut the base rate by 25 basis points to 4.75%. It is important because it can positively influence economic activity if it goes unimpressive.
Expectations of Growth and Inflation
The BoE is likely to trim down its growth expectations for the UK and also see inflation rates rise in this report. The inflation rate is likely to be at 2.8% by the third quarter of 2025, which is critical since the BoE wants a target of 2%. There are opinions differing between MPC members regarding the rate-easing process, with some members wanting faster cuts and others being more cautious.
Careful Strategy Ahead
Market expectations are that the BoE is likely to maintain a cautious policy given recent shocks, such as US trade policies. For now, many expect three quarter-point cuts throughout 2025 and see a good chance of one of those on February 6. In addition, the BoE may assume future economic growth at 1%-1.5%, much like its projections for last year.
