According to Odaily, analysts at Goldman Sachs have indicated that despite current high inflation pressures, there are signs suggesting a softer outlook for the UK's mid-term Consumer Price Index (CPI). The reasons cited include a noticeable slowdown in UK economic growth, with projections of only 0.9% growth in 2025 if the trend continues. Additionally, the growth of household real disposable income may decelerate, and escalating trade tensions could further hinder economic activity.
Goldman Sachs noted that while the Bank of England might slow down its rate cuts if underlying inflation does not improve, they believe the central bank is more likely to accelerate consecutive rate cuts to address weak demand. The firm anticipates a 25 basis point rate cut at the Bank of England's next meeting in February, with interest rates expected to decrease to 3.25% by mid-2026.