UK headline inflation rose to 3.6% in June, exceeding expectations and remaining unchanged from the previous month. Core inflation increased to 3.7%. Despite this, the CEO of deVere Group, Nigel Green, advocates for the Bank of England to proceed with a rate cut next month, arguing that the current inflation rise does not justify delaying this action. He indicates that inflation is on a disinflationary trend and that holding rates too high could harm the economy, which is fragile and exhibiting signs of weakening in the labor market.
"There's no question the latest inflation data will spark some jitters. But one slightly hotter-than-expected reading should not knock the Bank off course. A cut next month is still warranted - and, frankly, necessary."
"What we're seeing now is the bumpy endgame. The disinflationary trend remains intact, but it was never going to be perfectly smooth."
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