00:00 We're here in the City of London where the Bank of England has voted for the fourth consecutive
00:04 time to keep interest rates at 5.25%.
00:07 But we're looking at when they might finally drop.
00:12 Over the past two years, interest rates have gone up consecutively.
00:16 They went up between late 2021 and summer 2023 14 times to their high of 5.25%, which
00:23 they're still at now.
00:24 Last year, inflation got to double digit levels, which is why the bank was upping interest
00:28 rates consecutively.
00:30 But now, with inflation at 4%, there have been calls for the bank to drop interest rates.
00:35 Experts are divided on when they think interest rates will go down.
00:38 The majority of forecasters think the first cut to the base rate will come in May or June,
00:43 but some think it could be as late as August.
00:46 So whether interest rates come down sooner or later depends on whether inflation continues
00:50 to fall.
00:51 The bank's currently forecasted that inflation will come down to its 2% target level in the
00:56 second quarter of this year, but it's then said that it might jump back up again and
01:00 remain higher than 2% for months or potentially years to come.
01:04 If inflation continues to fall on its current trajectory, then we could see interest rates
01:08 fall in the summer.
01:10 But nothing is certain, and global events like the crisis in the Red Sea could push
01:14 inflation upwards and mean that rates come down later than expected.
01:17 [MUSIC PLAYING]
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