Inflation data released by the UK Census Bureau on Wednesday morning was released today and came in negative and below expected, as the consumer price index within Britain slowed at a pace above market expectations, hitting its lowest level since September 2021.
UK inflation slowed far more than economists expected in November, a surprise that prompted traders to bolster bets that the Bank of England would soon have to drop its narrative on high-interest rates for a lengthy period.
Where the Bank of England warned at its last meeting that it would not soften policy and cut interest rates until inflation was back on track and there was still a long way to go.
Now markets have moved to pricing in a nearly 50% probability of a rate cut in March 2024 and in case the cut is not made it will certainly be the first rate cut by the Bank of England in May next year. and there are also 137 basis points of rate cuts priced for 2024, It is a step above a total of almost 117 basis points ahead of today's UK CPI data.
