The next move in UK interest rates will be a cut, according to a Reuters poll of economists, but the Bank of England will probably wait until early next year before it follows the US Federal Reserve’s lead.

In a survey taken on 25-27 Sept, all 56 economists said the Bank of England would announce rates on hold at 5.75% when its next Monetary Policy Committee meeting ends on 4 October.

But 13 of 56 economists said rates would fall this year, most likely in November, and 36 said the MPC would cut rates to 5.5% or lower by the March 2008 meeting.

Asked separately to assess the probability of a Bank of England rate cut this year, analysts gave it a one in three chance. That was a huge shift from just a few weeks ago when they said there was still a one in three chance that rates would rise to 6% by the end of this year.