The Bank of England is poised to cut interest rates at least twice in 2024, according to a poll of economists.
A majority of the 41 economists who took part in The Times’s seventh annual economists’ survey said the Bank of England would partly reverse its aggressive tightening of monetary policy as economic growth stalls and inflation slides closer to the official 2% target.
Some 45% of respondents predicted that the central bank would lower rates three times or more in the coming year, while two cuts was the most common forecast. Two economists said the bank would leave the base rate at its present level of 5.25%, a 15-year high.
More than 80% said the economy would expand by between zero and 1% this year, leaving the country in what Sanjay Raja, senior economist at Deutsche Bank, called the “orbit” of a recession.
But economists polled by The FT said the UK economy would enter a “grey gloom” until the next election.
A rise in wages would be offset by high mortgages and rising rents, the majority of the 90 respondents said.
The partial catch-up of wages in 2024 would simply feel like swapping the “black gloom” of 2023 for “grey gloom”.
