Citi moves up first BOE rate cut to June from August previously

The firm now sees the BOE performing their first rate cut in June, arguing that:

“A combination of stubbornly weak activity, a further softening in labour market conditions, alongside in-line wage and services inflation numbers will now more likely than not push the BOE to begin cutting by the end of Q2”.

As for the entirety of the year, they maintain that the BOE will perform 125 bps worth of rate cuts in total. But they did not mention exactly how many rate cuts they are anticipating from the central bank.

Citi had previously gave the nod for an August start date and is still keeping the door open for that. They mention such a move is “plausible if inflation data for the second quarter proves more resilient”.

This article was written by Justin Low at www.forexlive.com.