The Bank of England predicts that inflation will fall to 2 percent eighteen months earlier

The Bank of England predicted yesterday that inflation will fall to its target of two percent 18 months earlier than expected.

The encouraging thing news led to predictions of four or five rate cuts later this year, starting in the month summer.

The Bank said inflation has fallen sharply from a 40-year high in October 2022 and is currently four percent.

In its latest report, it estimated that this figure would fall to two percent between April and June this year.

Yesterday, the interest rate was maintained at 5.25 percent for the fourth time in a row.

During its meeting, the Bank discussed the interest rate cut and – for the first time since the pandemic – a member of the committee voted in favor of an immediate cut.

However, two voted for an increase to 5.5 percent, while the remaining six members voted to remain unchanged.

It is the first three-way split of rates since 2008.

Bank Governor Andrew Bailey said of his position: “We need to see more evidence that inflation will fall all the way to two percent. goaland stay there before we can cut rates.”

Chancellor Jeremy Hunt pushed back against the optimistic predictions, saying: “We must remember that inflation never falls in a straight line.”