world-economy

Bank of England Expected to Maintain Rates Through 2026, Cut in 2027

The Bank of England will likely keep interest rates steady throughout 2026 despite inflationary pressures, according to forecasts from the Organization for Economic Cooperation and Development. The central bank's decision reflects expectations that energy-related price shocks will prove temporary, while weakness in the UK labor market will limit upward pressure on wages and inflation. The OECD projects the BOE will lower rates by a quarter point to 3.5% in 2027, even as inflation remains above the bank's 2% target. The UK economy is forecast to maintain its position as the third-fastest-growing nation in the Group of Seven, trailing only the United States and Canada. Gross domestic product projections remain largely consistent with the OECD's March outlook.