Bank of England Lifts Inflation Forecast to 3.75% by End-2026

The upward revision to both inflation and growth complicates the rate path: stronger activity alongside higher projected inflation removes the easy argument for near-term easing, even as growth remains modest. This matters most for UK rate-sensitive sectors and for crypto and RWA markets that have traded on global liquidity expectations, since a slower BoE normalization keeps sterling-denominated yields relatively attractive. The open question is whether the inflation overshoot proves persistent or transitory; the forecast's own trajectory, rising into early 2027, suggests the BoE itself does not expect a quick return to target.