June BoE: The Bank of England Pauses To Digest Weakening Growth And Employment Data

MTS Insights
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(9min)

Summary

  • The Bank of England paused rate cuts at 4.25%, reflecting caution amid weakening UK growth and labor market data.
  • Recent inflation data aligns with BoE forecasts, but risks remain two-sided. Inflation is expected to ease toward target next year.
  • Weakening GDP and rising unemployment suggest a likely 25 bps rate cut in August if trends persist.
  • Markets reacted dovishly, anticipating further easing, but recession fears could outweigh bullish sentiment if economic data deteriorates further.
Bank of England at night.

skywaytoheaven/iStock via Getty Images

The Bank of England (BoE) kept its main policy rate, the Bank Rate, unchanged at 4.25% following the June 2025 meeting. The decision to pause maintains the cadence of interest rate cuts that have led to a gradual easing in monetary policy since August 2024. While there

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