Resolution criteria

The market resolves based on the Bank of England's official Bank Rate on January 1, 2028. The current official Bank Rate can be verified at the Bank of England Database (https://www.bankofengland.co.uk/boeapps/database/Bank-Rate.asp). The rate will be determined by the most recent Monetary Policy Committee decision before or on that date. Resolution will match the exact rate announced by the Bank of England, rounded to the nearest 0.25%.

Background

The current Bank of England base rate is 3.75%, held at that level as of February 5, 2026. After four rate cuts in 2025, market signals are at odds with economist expectations. Economists still expect two or three rate cuts in 2026, though the pace remains uncertain. The Bank projects CPI inflation to fall to 2.0% in June 2026 and stay around 2% thereafter, which would support further easing. The BoE expected a 0.50-percentage-point reduction to 3.5% by Q3 2026, followed by incremental increases to 3.6% in 2027 and 3.7% in 2028.

Considerations

Forecasts for 2028 are inherently uncertain given the long time horizon. Economic conditions, inflation dynamics, and labor market developments between now and January 2028 could significantly alter the MPC's policy path. The answers provided cover the full range of plausible outcomes based on current expectations and historical precedent.

This description was generated by AI.