Many are assuming the Bank of England will hold rates for the rest of the year. But scratch the surface and there is a case for another move before year-end, says Martin Beck

Most analysts reckon the Bank of England is done cutting rates in 2025, a consensus reinforced by the Bank’s decision today to keep monetary policy on hold. With inflation still close to twice the two per cent target, the assumption is policymakers will sit tight until well into next year.

That may prove a mistake. Scratch beneath the surface, and the case for another move before year-end is stronger than the consensus suggests.

The reasons inflation is still running hot are rooted in the past. Earlier this year, households were hit with a wave of cost increases: energy bills, sewerage charges and bus fares all increased. At the same time, the government lifted employer National Insurance, introduced VAT on private school fees and sharply raised the National Living Wage. Businesses have understandably passed some of........

© City A.M.