Recently it looked almost certain that the Bank of England (BoE) was going to increase interest rates by 0.25%.
In February, BoE deputy governor Ben Broadbent said that it would not be a “great shock” to the economy if the bank raised interest rates more than once this year. However, now it would be a shock if interest rates were to rise.
Recently a wave of poor economic results and April’s disappointing GDP growth of 0.1% has resulted in the chances of an interest rate hike this month dwindling.
Hargreaves Lansdown personal finance analyst Sarah Coles said: “Back in early April, a rate rise at the May meeting was so widely predicted that it seemed nailed on.
“However, over the past few weeks, the picture has changed dramatically. A slew of disappointing data, and efforts by Mark Carney to talk down the chances of a rate rise, mean the markets are now pricing in the chance of a rise at just 8%.”
Subscribe to our newsletter to receive breaking news by email.