ECB’s Cipollone Backs Digital Euro as Europe Pushes for Payment System Independence 
RBA Raises Interest Rates by 25 Basis Points as Inflation Pressures Persist 
BOJ Policymakers Warn Weak Yen Could Fuel Inflation Risks and Delay Rate Action 
MAS Holds Monetary Policy Steady as Strong Growth Raises Inflation Risks 
Bank of England Expected to Hold Interest Rates at 3.75% as Inflation Remains Elevated 
Jerome Powell Attends Supreme Court Hearing on Trump Effort to Fire Fed Governor, Calling It Historic 
Fed Governor Lisa Cook Warns Inflation Risks Remain as Rates Stay Steady 
BOJ Rate Decision in Focus as Yen Weakness and Inflation Shape Market Outlook 
RBA Expected to Raise Interest Rates by 25 Basis Points in February, ANZ Forecast Says 
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.
