Sterling dropped by about half a cent against the US dollar as investors priced in an earlier rate cut by the BOE. "All going well, there should be scope for some further reduction in Bank Rate this year," he said. Bailey stressed he did not have any specific date in mind for the next rate cut. The BOE forecast inflation would slide to around its 2% target in April, helped largely by finance minister Rachel Reeves' budget in November. "On the basis of the current evidence, Bank Rate is likely to be reduced further," it said.

Source: The Edge Markets February 05, 2026 12:38 UTC