The acceleration of wage growth decline in the United Kingdom is expected to support further interest rate cuts by the Bank of England.

Economists at Bank of America reported that the faster slowdown in wage growth in the United Kingdom should support further interest rate cuts by the Bank of England. The average wage growth in the UK, excluding bonuses, decreased from 5.9% in February to 5.6% in March. Economists say that wage growth in the United Kingdom may continue to decline, creating conditions for further interest rate cuts. The market has fully digested expectations for another rate cut by the Bank of England, and by the end of 2025, the Bank of England is highly likely to cut rates again. Bank of America expects the Bank of England to cut rates three times in August, September, and November, bringing the policy rate down to a low of 3.5%.