Survey shows UK inflation cooling
In the UK meanwhile, the latest Bank of England (BoE) Decision Maker Panel (DMP) survey for February showed that most firms see selling prices and wage inflation cooling over the next year.
According to the DMP survey, selling price expectations decelerated to 4.1% from 4.3%, the lowest reading in over two years. Wage growth expectations softened to 4.9% on a three-month moving average basis from 5.2% in February.
Bank of England Governor Andrew Bailey recently said that market expectations for two or three rate cuts this year are “reasonable”, further increasing speculation the BoE will pull the trigger and cut rates in June.
Soft Services PMI data for March, released on Thursday, impacted the economic outlook for the UK, adding to the reasons for the BoE to cut interest rates.
The UK Services PMI fell to 53.1, missing expectations and the prior reading of 53.4.
Nevertheless, not all UK data was negative. A recent report by the UK’s largest building society Nationwide showed the first rise in house prices since January 2023, according to the Guardian.
This comes after BoE lending data showed a surprise rise in Mortgage Approvals rising to their highest level since September 2022 in February.
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