Skip to main content

Peak is in sight, but we’re not there yet

A shift from the 75 basis point hike in interest rates in November to a 50 basis point rise, from 3.00% to 3.50%, at the policy meeting on Thursday 15th December would show that the Monetary Policy Committee thinks it is getting closer to the peak in rates. Indeed, the Committee may indicate that it is starting to think more about the level of rates rather than the pace of hikes. Even so, we think it will want to see more concrete signs that domestic inflationary pressures are easing before halting the hikes. Our forecast is that rates will peak at 4.50% (the consensus is 4.25%) and won’t be cut until 2024.

We will be discussing the decisions of the BoE, the Fed and the ECB in a Drop In on Thursday 15th December at 3pm GMT. (Register here.)

Become a client to read more

This is premium content that requires an active Capital Economics subscription to view.

Already have an account?

You may already have access to this premium content as part of a paid subscription.

Sign in to read the content in full or get details of how you can access it

Register for free

Sign up for a free account to gain:

  • Unlock additional content
  • Register for Capital Economics events
  • Receive email updates and economist-curated newsletters
  • Request a free trial of our services

Get access