BOE Likely to Hold Rates, but Rate Hike Uncertainty Persists as 'Second-Round Effects' Loom

According to a Reuters survey and forecasts from major financial institutions released ahead of the Bank of England's rate decision on June 18, the central bank is widely expected to hold interest rates unchanged. Of 25 surveyed economists, 25 predict at least one 25-basis-point rate hike remains possible, while six forecast a potential cut. However, multiple analysts including Nomura Securities expect possible rate increases in July or September to mitigate inflation risks, particularly second-round effects from elevated energy prices linked to Middle East tensions. The BOE faces a balancing act between controlling secondary inflation pressures and avoiding further economic slowdown.
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