Survey puts Bank Rate at 4.25 percent from February 2027
Participants in the Bank of England's survey put Bank Rate at 4.00 percent for December 2026 and 4.25 percent from February 2027. Median inflation forecasts rise to 4.0 percent in Q1 2027 before declining to 2.0 percent five years ahead.
Higher rates before eventual easing
The survey collected responses from 80 participants on October 21–23, 2026.
Median Bank Rate forecasts remain at 4.25 percent through November 2027, then fall to 4.00 percent at end-2027, 3.75 percent in Q1 and Q2 2028, 3.50 percent in November 2028 and November 2029 and 3.25 percent in November 2031.
The median neutral rate is 3.50 percent; 42 respondents see upside risks, 32 balanced risks and four downside risks.
Median CPI inflation forecasts are 3.8 percent for Q4 2026, 3.9 percent for Q2 2027 and 3.4 percent for Q3 2027.
One-, two- and three-year forecasts are 3.0, 2.3 and 2.1 percent.
Median GDP growth forecasts are 1.4 percent for 2026, 1.3 percent for 2027 and 1.5 percent for 2028 and the long run.
Gilt supply rises as yields ease
Median forecasts put annual Debt Management Office gilt issuance at £250 billion in 2026–27 and £290 billion in 2027–28. The median 10-year gilt yield forecast falls from 5.25 percent at end-December 2026 to 5.00 percent at end-June 2027 and 4.93 percent at end-December 2027.
One-year exchange-rate medians are 1.3400 for GBPUSD and 0.8400 for EURGBP.
For energy prices six months ahead, 46 respondents assume Brent crude at $85–99 a barrel, while 29 assume UK natural gas at 150–179 pence per therm.
Energy drives the rate outlook
Energy receives a 30.3 percent weight in near-term rate expectations, the largest of any factor.
Moderate additional second-round energy effects underpin 52 respondents' forecasts, versus 17 assuming none and nine stronger effects.
These are participant views: staff design the survey without Monetary Policy Committee involvement.