It is still uncertain whether the United Kingdom's central bank will cut interest rates for the first time in August.
It is still uncertain whether the Bank of England will announce its first interest rate cut since 2020 next week, due to the regulations before the July 4th election. Major decision-makers have not spoken publicly for more than two months, making uncertainty greater than usual. Whether recent higher-than-expected service inflation is enough to prevent the central bank from lowering interest rates from the 16-year high of 5.25% is anyone's guess. Interest rate futures indicate a 50% chance of a 25 basis point rate cut on August 1. Although a Reuters survey shows that most economists still expect a rate cut, the Bank of England may wait until the next meeting on September 19 to make a decision.
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Australia is about to release the CPI for the second quarter, and whether the Reserve Bank of Australia will raise interest rates in August depends on it!
The inflation data released on July 31st in Australia may significantly affect policy expectations for the Reserve Bank of Australia meeting on August 6th. Recently, the RBA stated that the bank remains vigilant about the upward risks of inflation. If CPI data for the second quarter rises, this could break the balance and force the RBA to act. The strong market opinion is that if there is a rate hike, it will be the most reluctant rate hike in history, and a reversal may occur in the second quarter of 2025.