Andrew Bailey, Governor of the Bank of England, at the central bank's headquarters in London, UK, on November 29, 2024.
Holly Adams | Bloomberg | Getty Images
Bank of England Governor Andrew Bailey indicated on Wednesday that the UK could be on track for four interest rate cuts over the next year, if inflation continues on a downward path.
In response to a question during a video interview with the Financial Times whether the central bank was prepared to implement four cuts of a quarter of a percentage point over the next year, if its expectations about “continuation (inflation) a little” are met, Bailey replied: “Exactly.”
Markets are currently pricing in a suspension of interest rates at the Bank of England's December meeting, according to LSEG data, followed by three 25 basis point rate cuts.
The Governor of the Bank of England added that inflation fell faster than the central bank expected.
“A year ago, we were saying that inflation today would be about 1% higher than it actually is,” he said during the interview. “I think this is a good test of the (central banking) system.”
This is a breaking news story and will be updated soon.
