According to a report by Jin Ten Data, analyst Francesco Pesole from ING stated that the UK's overall inflation rate for April rose to 3.5% from 2.6% in March, exceeding economists' forecast of 3.4%. Nevertheless, the possibility of a rate cut in August still exists.
Pesole pointed out that the impact of tax-related factors is not enough to rule out the possibility of a rate cut in August, as the inflation trend in the service sector continues to improve. The surge in service sector inflation mainly reflects one-off factors.
After the data was published, the UK money market did not fully price in the expectation that interest rates would be cut in November. According to LSEG data, the likelihood of a rate cut in June is very low, while the possibility for August is 43%.