The Bank of England will delay its interest rate decision on Thursday to observe the two-minute silence marking the 80th anniversary of VE Day.
Britain's central bank announced it will publish its decision at 12.02pm rather than the usual noon time. The quarterly economic forecasts and minutes of the decision will also be released two minutes later than normal.
This represents a rare departure from the Bank's traditional noon announcement, which is closely monitored by savers, borrowers and financial markets both in the UK and worldwide.
The last time the Bank postponed an interest rates decision was in 2022, when it was delayed by a week due to the national mourning period following the Queen's death.
The Bank of England is delaying its interest rate announcement
GETTY/PAAnalysts widely expect the Bank's Monetary Policy Committee (MPC) to vote for a cut in interest rates to 4.25 per cent from the current 4.5 per cent.
This anticipated reduction comes as inflation has shown a downward trend in recent months. The Consumer Prices Index (CPI) inflation slowed to 2.6 per cent in March, down from 2.8 per cent in February, according to the latest official figures.
This cooling inflation likely signals to policymakers that interest rates, which are used as a tool to control rising prices, can continue to be reduced.
However, many experts are forecasting that inflation may rise again later this year. The Bank will need to balance these conflicting indicators as it makes its decision on Thursday.
Governor Andrew Bailey has suggested more base rate cuts from the Bank of England are on the way PAThe rates decision comes against a backdrop of mounting uncertainty over the economic outlook due to the global tariff war initiated by US President Donald Trump.
Economists suggest UK economic growth is likely to be slowed by elevated levels of uncertainty. Some businesses may suspend investments while consumers could decrease spending in response to these global tensions.
However, there could be unexpected benefits for UK consumers. Countries such as China, facing higher charges on exports to the US, may reroute trade and lower import prices for other countries.
Combined with other factors, including a weaker US dollar and falling oil prices, these developments could put downward pressure on inflation.
Rob Wood, chief UK economist at Pantheon Macroeconomics, suggests that back-to-back rate cuts in May and June could be likely.
However, he cautions that "accelerating inflation will keep MPC guidance cautious".
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GETTY"The MPC can get away with a couple of precautionary rate cuts back to back in May and June given the darker growth outlook, but we think rate-setters will continue to signal a gradual and cautious approach to easing after that," Wood said.
He explained the reasoning behind this cautious stance.
Wood warned: "The MPC took an extended period to try and return inflation to target after the post-Covid surge, allowing inflation expectations to de-anchor modestly, so they have to put more weight on suppressing inflation now."
This suggests that while immediate cuts are expected, the Bank will remain vigilant about inflation risks in the longer term
