A Reuters poll published on March 12 indicates that the majority of economists expect the Bank of England (BoE) to keep its bank rate unchanged at 3.75% during its upcoming meeting in March. Specifically, 85% of economists surveyed anticipate the rate will remain at 3.75% on March 19, a significant increase from the 35% who held this view in the February poll [1]. The BoE is scheduled to meet on March 18 and announce its decision on March 19, with the next Monetary Policy Report due on April 30 [1].
Looking ahead, the median forecast from the poll suggests that the BoE will cut the bank rate to 3.25% by the end of September, and that it will likely stay at this level until at least the end of 2026 [1]. In its most recent Monetary Policy Report, published on February 5, the BoE projected that CPI inflation would slow to 2.1% in the second quarter of 2026. However, it is noted that this projection was made prior to the onset of the Iran war, which could potentially impact future inflation expectations [1].
The BoE's monetary policy decisions are closely tied to its mandate of achieving price stability, targeting a steady inflation rate of 2%. Adjustments to the base lending rate directly influence the value of the Pound Sterling (GBP), with higher rates generally supporting the currency by attracting global investors, while lower rates tend to weaken it [1]. The article also explains that in extreme circumstances, the BoE may use Quantitative Easing (QE) to stimulate the economy, which typically results in a weaker Pound, or Quantitative Tightening (QT) when the economy strengthens and inflation rises [1].
No specific market reactions or analyst opinions regarding the immediate impact of the expected rate hold are provided in the article. The forward-looking statements are limited to the poll's forecast for a rate cut by September and the BoE's inflation projection for 2026 [1].
CONCLUSION
Economists overwhelmingly expect the Bank of England to keep rates steady at 3.75% in March, with a potential cut to 3.25% forecast by September. The BoE's inflation outlook remains cautious, projecting a slowdown to 2.1% by mid-2026, though geopolitical developments may affect this. The market impact is likely moderate, with the Pound's direction tied to future rate decisions and inflation trends.