Article details
ABN AMRO has revised its outlook for the Bank of England's monetary policy, noting a shift from a hawkish stance in March to a more dovish tone. The bank now anticipates one final interest rate hike this summer, followed by a pause as energy supply normalization in Q3 reduces inflationary pressures. This adjustment reflects uncertainty about the timing and magnitude of future rate cuts, which are expected to begin in late 2026. For markets, this signals a potential extension of the tightening cycle but with reduced urgency, which could stabilize GBP/USD volatility in the short term. Traders should monitor energy price trends and MPC statements for clues about the central bank's next moves. The evolving policy trajectory may also influence global forex markets, particularly emerging economies with currency linkages to the British pound. Investors should watch for data on UK inflation and employment to gauge the MPC's decision-making framework.
