U.S. Futures Steady as Rate-Cut Bets Rise on Soft Labor Data 
Japan’s Rising Inflation Strengthens Case for a Near-Term BOJ Rate Hike 
Asian Currencies Steady as Markets Await Fed Rate Decision; Indian Rupee Hits New Record Low 
Asia’s IPO Market Set for Strong Growth as China and India Drive Investor Diversification 
European Stocks Rise as Markets Await Key U.S. Inflation Data 
BOK Expected to Hold Rates at 2.50% as Housing and Currency Pressures Persist 
Asian Currencies Edge Higher as Markets Look to Fed Rate Cut; Rupee Steadies Near Record Lows 
Dollar Slides to Five-Week Low as Asian Stocks Struggle and Markets Bet on Fed Rate Cut 
UK Raises Deposit Protection Limit to £120,000 to Strengthen Saver Confidence 
European Oil & Gas Stocks Face 2026 With Cautious Outlook Amid Valuation Pressure 
RBA Signals Possible Rate Implications as Inflation Proves More Persistent 
New RBNZ Governor Anna Breman Aims to Restore Stability After Tumultuous Years 
The Bank of England (BoE) is expected to cut interest rates on Thursday, marking its third reduction since the COVID-19 pandemic. With the economy struggling due to rising costs, tax hikes by Finance Minister Rachel Reeves, and fears of a global trade war under U.S. President Donald Trump, policymakers face a tough balancing act.
Currently, the BoE’s benchmark rate stands at 4.75%, the highest among major economies. A widely anticipated 0.25% cut would align it with Norway’s rate and bring it closer to the U.S. Federal Reserve’s 4.25-4.5% range. The European Central Bank, responding to lower inflation risks, has already cut rates five times since mid-2024, compared to the BoE’s two.
Britain's economy has shown signs of stagnation, leading experts to believe more rate-setters will support easing monetary policy. Matt Swannell, chief economic advisor at the EY ITEM Club, noted that while economic growth projections have weakened, near-term inflation remains elevated. The BoE's decision, along with its latest economic projections, will be announced at 12:00 GMT, followed by a press conference with Governor Andrew Bailey.
Investors predict at least three quarter-point cuts by the end of 2025, while most economists foresee four. Lower borrowing costs could benefit Prime Minister Keir Starmer and Reeves, helping them manage fiscal targets. However, inflation remains a concern, with consumer expectations rising and wage growth accelerating.
Citi economists warn that energy price increases and rising labor costs could push inflation to 3.5% by April. December’s inflation stood at 2.5%, exceeding the BoE’s 2% target, and some analysts forecast a jump to 3% in January due to higher fuel costs. As the BoE navigates economic uncertainty, its next moves will be crucial in shaping Britain’s financial landscape.
