Thursday’s bonanza of four European central banks announcing interest rate decisions was as expected: the European Central Bank, Norges Bank, and Riksbank held their rates, while the Bank of England cut.
But there were hints at what’s ahead for 2026. Here are four key takeaways.
The markets thought the BoE’s rate cut was a done deal, with futures markets suggesting an almost 98% chance of one. But the vote to cut by 25 basis points was by the narrowest of margins: 5-4. A number of officials called for caution, citing continued risks to inflation.
Rate setter Meghan Greene, who was among the four opposing a cut, argued there were signs inflation for services was at risk of spiking, while inflation for core goods remained at pre-Covid levels.
Barclays U.K. Chief Economist Jack Meaning told CNBC the bank had delivered a “hawkish cut,” adding the bar could be higher for future cuts.
