Morgan Stanley Revises Up BOE Terminal Rate Forecast to 3.0% -- Market Talk

Dow Jones12-10

1529 GMT - The possibility of improved U.K. economic data and a potentially more cautious Bank of England in 2026 has caused Morgan Stanley to revise up its forecast for the BOE's terminal rate to 3% from 2.75% previously, Morgan Stanley's Bruna Skarica says in a note. U.K. inflation is expected to decline toward the 2% target, allowing for further rate cuts after an expected reduction next week, she says. "We expect the BOE to cut rates in December and February, but we now see a skip in March, followed by further action in April and June." Markets price a 90% chance of a BOE rate cut next week and only fully price in one further reduction in 2026, LSEG data show. (miriam.mukuru@wsj.com)

(END) Dow Jones Newswires

December 10, 2025 10:29 ET (15:29 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.

At the request of the copyright holder, you need to log in to view this content

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Comments

We need your insight to fill this gap
Leave a comment