Bank of England expected to hold rates for next few months as inflation jumps

UK inflation rose more than expected in January, with the headline rate increasing by 0.5pp to 3.0%, against consensus expectations for a rate of 2.8%.

While core and services inflation also saw sharp rises, they were either in line or below expectations.

With CPI expected to remain above target throughout the year but concerns growing about the weak outlook for growth, the Bank of England need to strike a fine balance to support the economy in 2025.

Cebr believes that the Bank will hold off on a further rate cut until the second half of the year.