• A majority of economists surveyed by Reuters expect the BoE to leave interest rates unchanged this year.
• UK inflation forecasts remain elevated for 2026 at an average of 3.2%.
• Economic growth expectations were slightly revised higher compared with the April poll.

The Bank of England (BoE) is expected to maintain a cautious stance as inflation remains above its target, according to a Reuters poll published on Wednesday.

Among the 56 economists surveyed, 27 expect the central bank to keep the rate unchanged at 3.75% throughout the year, while 7 foresee at least one rate cut and 22 anticipate at least one additional rate hike.

This split in expectations highlights the ongoing uncertainty surrounding the UK economy, as disinflation progresses slowly while growth risks remain present.

The Reuters poll also showed that UK inflation is expected to average 3.2% in 2026, unchanged from the April survey. Meanwhile, economic growth prospects were slightly improved, with Gross Domestic Product (GDP) growth projected at 0.8% for the year, compared with 0.7% in the previous poll.

These projections reinforce the view that the Bank of England could maintain a restrictive monetary policy for longer in order to contain inflationary pressures, even as economic activity shows some signs of stabilisation.

Market reaction

The British Pound did not react to the poll release, with GBP/USD trading around 1.3515 on Wednesday at the time of writing, down 0.17% on the day.