Falling Inflation Expectations Boost Chances of BoE Rate Cut in March

Falling Inflation Expectations Spark Policy Shift Anticipation

New data from a survey conducted by YouGov and Citigroup shows a notable decline in UK inflation expectations in February. This trend has prompted economists to reassess the likelihood of a Bank of England policy shift.

Analysts at Bank of America suggest that the combination of slowing inflation, a weakening labor market, and subdued wage growth could provide the necessary conditions for a BoE rate cut in March.

Market Bets on Imminent Monetary Easing

LSEG data indicates an 83% probability of a rate cut by the BoE this March, reflecting investors' concerns about the UK's economic outlook and anticipation for monetary easing.

• Declining inflation expectations may ease consumer pressure
• Softening labor market emerges as key policy consideration
• Sluggish wage growth impacts overall economic momentum