Tag: Interest Rates

Interest Rates and Bank Rate Decisions – What They Mean for Your Loan Facility

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For any business engaging in Secured Lending through facilities like Collateral Transfer, monitoring the central bank’s Base Rate decision is paramount. The official Bank Rate set by the Bank of England (or the equivalent key rate by the ECB, SNB, etc.) is the foundation upon which your borrowing costs are ultimately built.

Understanding this link is essential for effective Contract Fee Structures and accurate financial forecasting.

The Ripple Effect of the Base Rate

The Bank Rate is the key rate that influences the cost at which commercial banks can access central bank money and short-term market funding. Changes to this rate create a direct, cascading effect across the entire financial system:

  1. Cost of Funds: When the central bank raises the Base Rate, it becomes more expensive for commercial lenders to obtain funds. This increased cost is then passed on to corporate borrowers.
  2. Benchmark Rates: Most corporate loan facilities, especially variable-rate loans, are priced as a margin (or spread) over a recognized market benchmark, such as EURIBOR or SOFR. These benchmark rates tend to move in close correlation with the central bank’s decision.
  3. Lending Appetite: Higher interest rates increase the risk of borrower default, causing commercial banks to tighten their lending criteria and potentially reduce the amount of Business Finance they offer, even for secured deals.

How the Rate Impacts Your Collateral Transfer Costs

When accessing capital through a Collateral Transfer facility, you typically face two primary, separate costs:

1. The Collateral Transfer Contract Fee (Relatively Stable)

The Contract Fee is the annual charge paid to the Collateral Provider for the use of the Bank Guarantee (BG) or Standby Letter of Credit (SBLC).

  • This fee is generally negotiated and relatively insensitive to short-term rate moves, but over longer horizons, providers may reprice in light of the rate and credit environment.
  • It is typically a fixed percentage of the collateral’s face value for the duration of the initial contract.
  • Note on Structure: While the Contract Fee is primarily influenced by market demand and the provider’s rating, structures exist (as one possible arrangement) where the fee for subsequent years is fixed as a percentage over a benchmark rate, introducing an element of market rate influence.

2. The Loan Interest Rate (Fixed or Variable)

This is the actual interest you pay on the loan or line of credit secured against the BG.

  • Variable Loans: Interest rates are often calculated as Margin + Benchmark Rate (e.g., EURIBOR). When the central bank adjusts the Base Rate, the benchmark rate usually follows, and your annual loan cost changes accordingly.
  • Secured Advantage: Because the loan is secured by institutional collateral, the margin added by the lender is typically lower when strong collateral is in place than for an unsecured loan. This is one of the key benefits of using a Bespoke Collateral Funding Solution.

IntaCapital Swiss specialises in creating sophisticated Contract Fee Structures that ensure full transparency regarding these two cost elements.

Navigating Rate Changes in International Finance

Monitoring the Bank Rate allows clients to plan the optimal time for their Loan Facility negotiation and helps inform the choice between a fixed or variable interest rate.

By utilizing high-grade collateral, you gain Risk Mitigation and access to the most competitive rates available in the market. Contact our experts today to ensure your funding package is optimally structured for the current economic climate.

Bank of England Cuts Interest Rates

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The MPC Decision and Market Reaction

In a move that saw UK interest rates fall to their lowest level in almost three years, the Bank of England (BOE) cut its benchmark interest rate by 25 basis points to 3.75% today. The decision by the nine-member MPC (Monetary Policy Committee) was reached through a close call by 5 votes to 4, with the deciding vote being given by Governor Andrew Bailey. After the decision, earlier drops by sterling and 10-year gilt yields were erased, with the pound slightly up against the US Dollar at $1.3396.

Inflation Targets and Future Borrowing Costs

Data recently released showed pressures on prices, the jobs market and economic growth all moving south, with officials from the BOE announcing that they expect inflation to fall closer to the benchmark target of 2%. Officials also announced that, based on current data, they expect borrowing costs to further decline in 2026, but cautioned that decisions on interest rates will be finely balanced as they move to what they describe as the neutral interest rate, where there is neither negative nor positive pressure on inflation.

Governor Andrew Bailey’s Assessment

After the meeting, Governor Andrew Bailey said, “Data news since our last meeting suggests that disinflation is now more established. CPI (consumer price index) has fallen from its recent peak, and upside risks have eased. Measures in the budget should reduce inflation further in the near term, but the key question for me now is the extent to which inflation settles at the 2% target in an enduring way. Slack has continued to accumulate in the economy, and unemployment, underemployment and flows from employment to unemployment have all risen.”

Economic Stagnation and Market Forecasts

Data released shows that the UK economy shrank by 0.10% in the last three months to October, and BOE officials said that they expect 0.00% economic growth in Q4 2025, down from previous expectations of 0.30% growth. Financial markets had widely expected a cut in interest rates due to the recent decline in inflation, which had outpaced expectations, lacklustre economic data and a softening labour market. Some experts are at odds as to whether or not there will be one or two rate cuts in the first half of 2026, with the markets currently pricing in a cut of 37 basis points. 

Labor Market Pressures and 2026 Outlook

Some economists suggest that the UK’s surging unemployment will negatively impact pay growth. They argue this will force the BOE into rate cuts in 2026. Much of the debate within the Monetary Policy Committee is expected to focus on how far interest rates should be cut to stabilise unemployment and stimulate a recovery in demand. Currently, it would appear that there is consensus amongst market experts and analysts that there will be an interest rate cut in 2026; however, the scale of easing remains unclear.

Swiss National Bank Holds Interest Rates Steady

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Today, the SNB (Swiss National Bank) kept its benchmark interest rate on hold at 0.00%, as many market experts had already priced in a minimal chance of a rate reduction. This is the second straight meeting where the central bank has kept interest rates on hold, against a backdrop of zero inflation, which is at the lower end of the SNB’s target range of 0.00% – 2.00%. The bank signalled that they are open to further rate cuts if threatened with a sustained period of falling prices.

Reasons Behind the Decision

Following the rate decision, the Chairman of the SNB, Martin Schlegel, pointed out that there were bigger considerations than just reducing rates into negative territory, given the financial hits that pension funds, banks’ profits and savers would have to bear. Investors have always seen Switzerland as a haven for savings in times of strife and geopolitical tensions, which has presented the central bank with several problems. 

Under normal circumstances, with inflation at zero and the Swiss franc hitting recent highs against the euro, the case for cutting rates would have been far stronger. But the bank has set a much higher bar for moving into negative rates, making such a move far less likely now.

Inflation Outlook

The SNB has cut its inflation forecast for 2026 to 0.3% and 0.6% for 2027, and experts say that today’s rate cut decision is an indication that the bank is prepared for a fairly long period of low inflation. One market expert noted, “Leaving policy rates at 0.00% now also implies that these low inflation rates will not be sufficient to trigger another cut.” The SNB President Martin Schlegel also pointed out that “Inflation in recent months had been slightly lower than expected, but the outlook is basically unchanged. Our monetary policy is helping to ensure that inflation is likely to rise slowly in the coming quarters.”

Economic Growth and Trade Impact

There was a contraction in the Swiss economy in Q3 due to President Trump placing a tariff of 39% on many of Switzerland’s exports. This has since been replaced with a 15% tariff, which the President of SNB acknowledged was a positive development. 

New data show the Swiss economy is gaining momentum, prompting the central bank to upgrade its growth outlook. GDP growth for 2025 has been revised from 1.0% to just under 1.5%, with the 2026 forecast raised from just under 1.0% to just under 1.5% as well.

The Federal Reserve Cuts Interest Rates by a Quarter Point

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FOMC Announces Rate Cut Amidst Divisions

Today, the Federal Reserve’s FOMC (Federal Open Market Committee) cut interest rates by 25 basis points to 3.50% – 3.75% in a majority vote (9-3), which included three dissensions.  The divisions within the FOMC are between members who see stubborn inflation as the biggest risk and those who believe weakness in the labour market poses the greater threat to the U.S. economy. Indeed, Austan Goolsbee and Jeff Schmid, both regional Federal Reserve presidents from Chicago and Kansas City, voted against a rate cut, whilst Governor Stephen Miran (a President Trump appointee) dissented in favour of a larger cut of 50 basis points.  

Deep Divide Over Future Interest Rate Decisions

As details of the meeting were released, it became clear that the Federal Reserve is very much divided over interest rate cuts. Although Chairman Jerome Powell downplayed the dissenting voices over the decision to cut rates, several non-voting regional Federal Reserve presidents signalled their opposition by arguing that the year-end benchmark rate should be kept between 3.75% and 4.00%. Such divisions could make life difficult for the new Chairman (who will be picked by President Trump to get agreements on interest rate decisions). The President also commented that the interest rate cut could have been larger.  

Cautionary Language in Post-Meeting Statement

The FOMC has now cut interest rates for the third time in a row, but the language emanating from the post-meeting rate statement was one of caution and reflected the contents of a post-meeting statement back in December 2024. The current statement read, “In considering the extent and timing of additional adjustments to the target range for the federal funds rate, the committee will assess incoming data, the evolving outlook, and the balance of risks.” However, in December 2024, the same language was used, and as a result, the Federal Reserve did not cut rates for another nine months until September 2025.  

Market Uncertainty and the Dual Mandate

Experts suggest that the financial markets will face a degree of uncertainty regarding the Federal Reserve’s monetary policy for 2026, as labour market strength and inflation trends remain unclear. Due to the Federal Reserve’s dual mandate of price and employment stability, the debate within the central bank will continue unabated with one market expert saying, “It’s highly unknowable where we are headed in the next six to nine months, just given all the changes that are out there in this historically kind of odd period where you have tensions on both sides of the mandate.”  

Policy Decisions Amidst Data Gaps

Due to the 43-day government shutdown, recent official data on inflation and unemployment are for September and showed inflation rising from 2.70% to 2.80%, and unemployment rising from 4.30% to 4.40%. In the Federal Reserve statement, it was announced that, “Available indicators suggest that economic activity has been expanding at a moderate pace, job gains have slowed this year, and the unemployment rate has edged up through September.”   

The latest policy statement was, however, put together without the benefit of inflation and job data but relied on available indicators, which officials said included their own private data, community contacts and internal surveys. Inflation and job data for November are expected to be released next week, followed by a full report on economic growth for Q3. The rate cut outlook for 2026 is uncertain as policymakers remain deeply divided, with median projections pointing to a single cut in 2026 and a further cut in 2027. However, eight officials have signalled their support for two cuts in 2026, whilst seven officials have indicated their support for no rate cuts next year.

Outlook for Gold 2026

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There is a divergence amongst gold experts and analysts regarding the price of gold in 2026, where some predict a continuation of gold’s strength, and others suggest a potential correction or just a modest gain. 

The Remarkable Performance of 2025

2025 was a remarkable year for gold, returning over 60% whilst also achieving over 50 record highs. This outstanding performance was underpinned by various factors such as heightened geopolitical uncertainty, global economic uncertainty, central banks increasing their gold purchases (especially China), positive price momentum and a weaker U.S. Dollar.

Core Factors Shaping 2026

However, looking forward to 2026, many experts, analysts and financial commentators believe that gold will be defined by ongoing global economic uncertainty and geopolitical unrest. They suggest that if the prevailing conditions currently affecting gold remain the same moving into 2026, then gold is likely to remain rangebound. However, if interest rates fall and economic growth slows, then gold could enjoy a moderate increase in value. 

Gold could perform at heightened levels in the event of a severe economic downturn driven by growing global risks. Conversely, if geopolitical tensions ease and White House policies boost economic growth, strengthening the dollar and pushing interest rates higher, the price of gold would likely fall.

Analysts suggest that as we move into 2026, financial markets expect the status quo to continue. However, uncertainty will persist due to geo-economic pressures on financial data, questions over whether inflation can finally be brought under control, and the outcome of political negotiations aimed at easing geopolitical unrest. 

Gold as a Strategic Diversifier

Another key aspect of gold is its role as a portfolio diversifier and a source of stability in times of political unrest and market volatility. This is especially prevalent as to whether we see a risk-on or risk-off sentiment, which will shape not only gold but all asset classes, and will affect gold’s status as a strategic diversifier*.

*Gold as a Strategic Diversifier – In investment terms, gold is included as a core, long-term asset within a multi-asset portfolio to enhance stability and improve risk-adjusted returns, rather than using the metal for short-term speculation. Some of the main characteristics of gold are an inflation and deflation hedge, and a historical record of preserving purchasing power. Other characteristics are no counterparty or credit risks (such as bonds or shares), as well as the market being highly liquid, meaning that the metal can be easily traded even in times of volatile and turbulent market conditions.

Bullish Price Targets and Downward Risks

Some market experts remain extremely bullish and are suggesting that in 2026, the yellow metal could go as high as USD 5,000, propelled by a cocktail of central bank buying, concerns over Donald Trump’s tariffs, a widening United States deficit and stubborn inflation. Some experts predict that the Federal Reserve will cut interest rates by 75 basis points in the coming year and expect strong investor demand to continue. Many believe the bull market is far from over and that gold’s long-term rally will extend well into 2026. But bulls beware, as mentioned above, there are many twists and turns expected in 2026, some of which might put downward pressure on the yellow metal.

The Record-Long U.S. Government Shutdown Has Come to an End

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Global shares rose on Monday, 10th November, largely driven by sentiment that the historic U.S. federal government shutdown was finally nearing an end. The day before, on 9th November, the U.S. Senate advanced an agreement that would potentially reopen the federal government and end a shutdown then in its 40th day, which had furloughed federal workers, disrupted air traffic, and delayed food aid programmes.

On Wednesday, 12th November, the Senate voted on a House-passed procedural bill amended to fund the government until 30th January 2026. The Senate passed the measure and sent it back to the House of Representatives, where it was approved the same evening by a vote of 222–209. As in the Senate, Democrats largely opposed the bill because it did not include their key demand: renewal of subsidies for Affordable Care Act insurance policies, which are set to expire on 31st December 2025.

Later that evening, at 10:24 p.m. EST, President Donald Trump signed the legislation into law, officially ending the longest government shutdown in U.S. history (43 days). Experts estimate it may take federal workers until the end of the year to clear the accumulated backlog. Transport Secretary Sean Duffy indicated that current flight restrictions at major U.S. airports could take up to a week to lift. Delta Airlines’ CEO reported that over 2,000 flight cancellations linked to the shutdown will negatively affect the company’s quarterly earnings, with holiday bookings down by approximately 5%–10%.

According to data from the Congressional Budget Office (CBO), the shutdown cost the government USD 3 billion in back pay for furloughed workers and USD 2 billion in lost tax revenue, mainly due to reduced IRS tax-compliance activities. The CBO further estimates that the total impact on the U.S. economy could range between USD 7 billion and USD 14 billion, with Q4 GDP potentially falling by 2% due to reduced government spending. In a letter dated 29th October 2025 to the House Budget Committee, the CBO director noted: “Although most of the decline in GDP will eventually be recovered, the CBO estimates that USD 7–10 billion will not be recovered.”

Federal Reserve officials are now preparing to determine whether to cut interest rates again at their December policy meeting. Unfortunately, limited data availability — due to the shutdown’s impact on the Bureau of Labour Statistics (BLS) and the Bureau of Economic Analysis (BEA) – may hinder their decision-making. However, it is hoped that all necessary data will be available by the meeting on 10th December 2025, unlike the previous meeting on 28th–29th October, when they had only partial data.

The legislation signed by President Trump only funds the federal government until 30th January 2026. This stopgap gives Democrats ample time to renew their demands for the reinstatement of Affordable Care Act insurance subsidies, which will have expired by 31st December 2025. Should lawmakers fail to reach an agreement on this contentious issue, the American public may once again have to brace for another federal government shutdown.

Bank of England Keeps Interest Rates on Hold

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In a knife-edge vote, with Governor Andrew Bailey casting the deciding ballot, the MPC (Monetary Policy Committee) voted 5–4 to keep interest rates on hold at 4.00%. It was a narrower margin than expected, with one poll of economists prior to the announcement predicting a 6–3 vote in favour of keeping borrowing costs unchanged. Indeed, two Deputy Governors of the Bank of England, David Ramsden and Sarah Breeden, along with the rest of the minority, voted for a 25-basis-point rate cut. It was also the first time that Sarah Breeden voted against the majority since joining the MPC in 2023.

Although inflation remains almost double the Bank’s target, officials announced after the vote that they believe inflation has now peaked at 3.8%. The MPC also signalled that rates could fall to 3% by 2028, while some analysts predict that cuts could come sooner. Experts suggest that Governor Bailey’s deciding vote was influenced by several factors, one being his desire not to appear biased towards the government, particularly with the Chancellor’s Budget just around the corner. It is also thought he preferred to wait and see what fiscal measures the Chancellor will announce, especially as she has been signalling a short-term increase in taxes.

Minutes released from the MPC meeting showed that Governor Bailey was the most dovish among the majority. In a written statement, the Governor said: “We still think rates are on a gradual downward path, but we need to be sure that inflation is on track to return to our 2% target before we cut them again”.

A number of market experts have described this as a “dovish hold”. Governor Bailey also remarked that “upside risks to inflation have become less pressing since August”. Analysts suggest that another reason for maintaining rates was the Governor’s preference to wait for further evidence that inflation is continuing to decline.

Interestingly, several financial experts believe that the Bank of England’s latest inflation forecast has paved the way for an interest rate cut (estimated at 25 basis points) when the MPC meets again on 18th December. Data shows that the Bank of England has cut interest rates five times since Labour won the general election on 4th July 2024. Following today’s decision, Governor Bailey noted that “the MPC would have an opportunity to consider the Budget before its 18th December meeting”.

If, as suspected, the Budget includes tax increases, analysts predict that weaker demand could follow, pushing inflation lower in 2026 and thereby creating a plausible case for a rate cut in December.

The Federal Reserve Cuts Key Benchmark Interest Rates

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On Wednesday, 29th October, the Federal Reserve’s FOMC (Federal Open Market Committee), for the second time in 2025, and in consecutive months, reduced interest rates by 25 basis points to 3.75% – 4.00%, marking the lowest level in three years. The vote to cut rates was 10 – 2 in favour, with two dissenting voices opposing the decision: Stephen Miran and the President of the Federal Reserve Bank of Kansas City, Jeffrey Schmid.

It appears that the Federal Reserve is divided into two camps, with the dissenters concerned about inflation, while the majority are focused on the job market. Two non-voting members of the FOMC, Lorie Logan, President of the Federal Reserve Bank of Dallas, and Beth Hammack, President of the Federal Reserve Bank of Cleveland, who will rotate into voting positions in 2026, both indicated they would have preferred to hold rates steady this time.

Remarks made by the aforementioned Federal Reserve Bank Chairs suggest that, moving forward, there will be a lively debate over the next six weeks ahead of the next FOMC policy meeting on 9th – 10th December. It is shaping up to be a direct contest between those concerned about persistent inflation and those prioritising support for the labour market. Dallas Fed chair Logan remarked, “I’d find it difficult to cut rates again in December unless there is clear evidence that inflation will fall faster than expected or that the labour market will cool more rapidly.”

At a press conference following the rate cut, Federal Reserve Chairman Jerome Powell advised that another reduction at the next policy meeting in December “is not a foregone conclusion”.  The Chairman added, “There were strongly differing views on how to proceed in December during the meeting today and we have not made a decision about December”. Therefore, no decision has yet been made regarding future rate cuts, with Powell emphasising that any such move should not be seen as inevitable.

The Federal Reserve has a so-called dual mandate requiring policymakers to maintain both low unemployment and low inflation. Chairman Powell noted in October that risks to the labour market are increasing, though experts have advised that the ongoing government shutdown has resulted in a lack of economic data, a factor that may be hampering FOMC decision-making. One analyst commented, “A prolonged government shutdown and on-going tariff negotiations continue to introduce significant uncertainty into the immediate monetary policy outlook”.

Experts suggest that the Federal Reserve’s hands are somewhat limited due to the near blackout on economic data.  However, the government did unexpectedly release the September 2025 CPI (Consumer Price Index) figures on 24th October, which showed a 3% annual increase and 0.3% monthly increase, both lower than anticipated. The FOMC remains committed to both sides of its dual mandate, and with economic uncertainty still elevated, has seemingly opted to prioritise employment for now. Inflation, however, remains above target, and if next month’s data (assuming the government shutdown ends) shows an uptick in inflation, it could see renewed tension between the labour market and inflation factions within the FOMC.

Swiss National Bank Keeps Benchmark Interest Rate on Hold

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Today, the SNB (Swiss National Bank) kept its key benchmark interest rate unchanged at 0%, as it continues to assess the impact on the economy of the tariffs imposed by United States President Donald Trump. The zero percent interest rate is the lowest among all major central banks and reflects the monetary policy of the SNB and the unique position of Switzerland’s economy. Money markets were not surprised by the interest rate hold (the first in seven meetings), but experts advise that, apart from tariffs dimming the outlook for the economy in 2026, there has been a small uptick in inflation in recent months.

Following the first monetary policy decision since Switzerland was hit with 39% tariffs in August this year, officials from the SNB noted that they expect growth in 2026 to be just under 1%, with unemployment likely to continue rising. Experts also suggest that the interest rate hold was also down to the stability of the Swiss Franc and also reflects the return of inflation that is still within the SNB’s target range of 0% – 2%, but is expected to move closer to the 1% mark in the next few years, having returned from negativity in May of this year.

The Chairman of the SNB, Martin Schlegel said, “Inflationary pressure is virtually unchanged compared to the previous quarter and we will continue to monitor the situation and adjust our monetary policy, if necessary, to ensure price stability”. The Chairman, with regard to interest rates, has said repeatedly that there are problems with reintroducing negative interest rates, which were in play between December 2014 to September 2022, which initiated concerns from both pension funds and savers.

Officials from the SNB also advised that Swiss companies doing business in the watchmaking and machinery sectors have been especially affected by tariffs, but the impact elsewhere, particularly in services has been limited. They also went on to say “The economic outlook for Switzerland has deteriorated due to significantly higher U.S. tariffs, which are likely to dampen exports and investment, especially“.

After the announcement, the Swiss Franc was broadly unchanged against the Euro and the US Dollar. Since January of this year, the Swiss Franc has rallied against the US Dollar and the Euro and has approached its highest level in almost a decade as investors have treated the currency as a safe haven in times of uncertainty. Furthermore, analysts advise that data released shows that since the beginning of the year, the Swiss Franc has rallied over 12% against the dollar and circa 1% against the Euro, making it one of the best-performing G-10* currencies of 2025.

*G-10 – A forum of eleven economically advanced nations that consult on economic and financial matters, such as international financial stability. 

Purpose

To foster cooperation and address emerging financial risks, especially concerning the International Monetary Fund (IMF).

History

The group formed from an agreement to provide the IMF with additional funds through the General Arrangements to Borrow (GAB). 

Membership

Includes Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, Sweden, Switzerland, the United Kingdom, and the United States. 

Bank of England Leaves Benchmark Interest Rates on Hold

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Today the BOE’s (Bank of England) nine-member MPC (Monetary Policy Committee) voted 7-2 to keep interest rates on hold at 4.00%, with the two dissenting votes of Swati Dhingra and Alan Taylor both voting for a 25-basis point cut. Experts were not surprised at the MPC holding interest rates as data released shows that prices are increasing at twice the rate predicted by the BOE. However, officials said that they still expected inflation to return to the Central Bank’s target of 2%, but remained somewhat on the fence as regards further cuts this year.

However, the Governor of the Bank of England, Andrew Bailey, was slightly more forthcoming, saying that they are not done with the cycle of cutting interest rates referring to the possibility of upcoming risks with regards to cooling in the jobs market. Whilst highlighting rising inflation and an easing labour market Governor Bailey said, “there are risks on both sides” and added “I continue to think that there will be further reductions, but I think the time and scale of those is more uncertain now than before August”.

Analysts advise that financial markets see less than a 30% chance of another rate cut this year despite any implied optimism by Governor Bailey. The MPC meets two more times this year to discuss interest rates and experts advise that a rate cut at the November meeting of the MPC is all but ruled out as they expect inflation to hit 4%, double the BOE’s target figure which is backed up by Governor Bailey also saying “The pricing at the moment which basically says ‘look, there’s going to be a period where we’re watching very carefully to see how the economy unfolds before whatever we do next in terms of movement’ is, I think is the right thing”.

The BOE has also warned that the economy is being negatively impacted due to further tax raids by the current labour government with analysts saying that the Chancellor of the Exchequer, Rachel Reeves, will probably have to find somewhere between £20 Billion to £50 Billion in either spending cuts or tax increases to maintain her fiscal plans, but according to some financial commentators, either way her credibility is diminishing at a rapid rate.

Indeed, Governor Bailey noted that higher inflation was partly to blame on government policy, and in an open letter confirming that thought, he advised inflation was almost double (3.8%) of the bank’s target and said this was due to “the increase in employer NICS (National Insurance Contributions) and pay growth in sectors with a large share of employees at or close to the NLW (National Living Wage). Officials noted that they had previously warned that the introduction of net zero packaging taxes are also pushing up prices with inflation on supermarket shelves expected to continue up to close of business 31st December 2025. All in all, analysts advise that the general feeling in the financial markets is that the benchmark interest rate will remain the same at 4.00% come the end of the year.

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