Bank of America Forecasts Two 25bp BOE Hikes and Three 2027 Cuts
Bank of America economists forecast two 25-basis-point Bank of England rate hikes in June and July 2026, followed by three 25-basis-point cuts in 2027 to a 3.50% terminal Bank Rate. French authorities have detained four suspects, including three minors, over a foiled March bombing plot against BofA’s Paris office.
1. BOE Rate Forecast
BofA’s rates strategists now project the Bank of England will raise the Bank Rate by 25 basis points in both June and July 2026, then reverse course with three 25 basis-point cuts in April, July and November 2027 to reach a 3.50% terminal rate. The firm flagged risks skewed toward a 3.25% peak and expects a near-term flattening of the U.K. rates curve ahead of an eventual dovish pivot.
2. Foiled Paris Bomb Plot
French judicial authorities have ordered pretrial detention for four suspects—one adult and three minors—over a foiled bombing plot targeting Bank of America’s Paris office in March. Officials allege links to a pro-Iranian group, raising concerns over potential increases in security expenditures at the bank’s European branches.