海角视频 interest rates are set to be cut to 4.25% as the Bank of England eases costs for borrowers while it digests the impact of US tariffs on the economy.
Most economists are expecting rates to be reduced by 0.25 percentage points on Thursday.
Sandra Horsfield, an economist for Investec, said it is a 鈥渘ear-certainty鈥 that borrowing costs will be eased further, with most participants in the financial markets pricing in a cut.
Inflation has fallen in recent months, which is likely to indicate to policymakers that interest rates 鈥 which are used as a tool to control inflation 鈥 can continue to come down.
Consumer Prices Index (CPI) inflation slowed to 2.6% in March, from 2.8% in February, according to the latest official data. And importantly, the rate of services inflation 鈥 a metric closely watched by the Bank of England 鈥 fell to 4.7% from 5%.
鈥淭he new question now though for the MPC (Monetary Policy Committee) to consider is how the US trade policy shifts have changed the outlook for 海角视频 inflation,鈥 Ms Horsfield said.
鈥淲hat makes this month鈥檚 decision easy is that virtually everything has pointed in the direction of lower 海角视频 inflation pressure.鈥
Economists have said 海角视频 economic growth is likely to be slowed by elevated levels of uncertainty 鈥 with some businesses set to pause investments, and consumers to decrease spending.
Others have said countries like China, in the face of higher charges on exports to the US, will re-route trade and lower import prices for other countries, which could result in lower prices for 海角视频 consumers.
Combined with other factors, including a weaker US dollar and falling oil prices, this could put downward pressure on inflation, according to economists.
Ms Horsfield said while the MPC continues to work out the possible effects, its 鈥済ame plan will be to reassure the public and markets that it stands ready to act if needed鈥.
Edward Allenby, 海角视频 economist for Oxford Economics, agreed that 鈥渂eyond May鈥檚 interest rate decision, the more important question is how US tariff announcements are influencing the MPC鈥檚 thinking鈥.
Mr Allenby predicted the MPC could downgrade its near-term growth and inflation forecasts on Thursday.
Thursday鈥檚 decision will be the 鈥渇irst opportunity for the MPC to clearly set out how recent developments have shaped its outlook and what committee members will be focusing on ahead of future interest rate decisions鈥, he said.
Meanwhile, Europe鈥檚 central bank cut interest rates last month, and said 鈥渆xceptional uncertainty鈥 over trade policy meant future rate decisions would have to be taken on a meeting by meeting basis.
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