Institution: The Bank of England may accelerate the pace of interest rate cuts in the second half of the year

ChainCatcher news, senior economist Luke Bartholomew from investment company Abrdn stated in a report that the impact of the upcoming increases in UK employers' National Insurance contributions and the national minimum wage may prompt the Bank of England to accelerate its rate cuts in the second half of this year.

Data released on Tuesday showed that the average wage growth rate is expected to rebound to 5.9% by the end of 2024, and for now, rate cuts are still expected to be gradual. However, the biggest test will be how the labor market responds to the changes announced in the government's autumn budget. There are clear signs that recruitment intentions are expected to cool. If economic growth remains very slow, then it is quite likely that the Bank of England will cut rates more quickly in the second half of this year.