Bank of England Poised for Interest Rate Cut Amid Budget Concerns

The Monetary Policy Committee is expected to lower rates next week despite potential inflationary pressures from Labour's spending plans.

Analysts predict the Bank of England will cut the base interest rate by a quarter-point to 4.75% at its upcoming meeting.
Recent data shows UK inflation has fallen to 1.7%, below the Bank's target, prompting expectations for a rate reduction.
Labour's budget, featuring £70 billion in additional annual spending, could lead to higher inflation, complicating rate decisions.
Economists suggest that while immediate rate cuts are likely, future reductions may be more gradual due to fiscal policy impacts.
Market expectations for rate cuts next year have decreased following the budget announcement, affecting government bond yields.