{"id":43765,"date":"2026-03-30T20:42:49","date_gmt":"2026-03-30T20:42:49","guid":{"rendered":"https:\/\/www.vtmarketsglobal.com\/en\/uncategorized\/43765\/"},"modified":"2026-03-30T20:42:49","modified_gmt":"2026-03-30T20:42:49","slug":"societe-generale-says-markets-expect-70bp-boe-easing-in-2026-though-officials-resist-no-cuts-expected-this-year","status":"publish","type":"post","link":"https:\/\/www.vtmarketsglobal.com\/en\/live-updates\/43765\/","title":{"rendered":"Societe Generale says markets expect 70bp BoE easing in 2026, though officials resist; no cuts expected this year"},"content":{"rendered":"UK markets are pricing about 70 basis points of Bank of England easing in 2026, despite some Monetary Policy Committee resistance. Societe Generale\u2019s economists expect no Bank of England rate cuts this year.\n\nHeadline CPI was 3% in February, matching both the Bloomberg consensus estimate and the Bank of England\u2019s February projection. The economists note this reading came before an energy price shock.\n\n

Near Term Inflation Outlook<\/h3>\nThey expect higher fuel prices to lift headline CPI to about 3.2% year on year in March. This is around 0.5 percentage points above the Bank of England\u2019s February MPR projection.\n\nInflation is expected to stay around 3\u20133.5% through 2026. The economists attribute limited follow-on price pressures to economic slack, rising joblessness, and weak consumption reducing firms\u2019 ability to raise prices.\n\nAttention this week is expected to turn to second-tier data releases. The March Decision Makers\u2019 Panel survey is expected to provide early evidence of company CPI and wage expectations after wholesale energy prices rose.\n\nThe market is pricing in significant Bank of England easing, with the SONIA forward curve on March 30, 2026, still reflecting nearly three 25-basis-point cuts this year. We believe this is a mispricing given that inflationary pressures are proving to be persistent. This disconnect between market pricing and economic reality presents a clear opportunity for derivatives traders.\n\n

Trade Expression And Market Catalysts<\/h3>\nHigher energy costs are a key reason for our view, with Brent crude holding firmly above $85 a barrel through the first quarter of 2026. This has directly contributed to headline CPI ticking up to 3.2% in the latest ONS report for March, which is above the Bank\u2019s earlier forecasts. We expect inflation to remain elevated around the 3-3.5% level for the remainder of the year.\n\nWhile the economy does show signs of slack, this doesn’t automatically trigger rate cuts. Recent labour market data confirmed a slight rise in unemployment to 4.5%, which should help contain wage growth and limit second-round inflation effects. However, with inflation still well above the 2% target, this slack is more likely to keep the MPC on hold rather than compel them to ease policy.\n\nLooking back at 2025, markets were rewarding bets on a steady decline in inflation, but that trend appears to have stalled. The most direct way to position for rates staying higher for longer is through short-term interest rate futures. We see value in selling December 2026 SONIA futures, as their price will fall if the market begins to price out the aggressive rate cuts we view as unlikely.\n\nAnother strategy involves using interest rate swaps to pay a fixed rate against receiving the floating SONIA rate. This position becomes profitable if the BoE does not cut rates as much as the market currently expects, causing the floating rate we receive to be higher than anticipated. It is a straightforward play on the forward curve being too low.\n\nThis week’s focus will be on second-tier data, which could serve as a major catalyst. The March Decision Makers\u2019 Panel survey is particularly important as it will provide the first real glimpse into how UK firms are adjusting their price and wage expectations after the recent energy price increases. A strong reading here could force the market to quickly reconsider the viability of 70 basis points in cuts.\n\nCreate your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b>\n

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Start trading now – Click here<\/a> to create your real VT Markets account <\/strong> <\/p>\r\n","protected":false},"excerpt":{"rendered":"

UK markets price 2026 BoE cuts, but SocGen sees none; inflation near 3\u20133.5% persists.<\/p>\n","protected":false},"author":38,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[46],"tags":[],"class_list":["post-43765","post","type-post","status-publish","format-standard","hentry","category-live-updates"],"acf":[],"aioseo_notices":[],"featured_image_src":null,"featured_image_src_square":null,"author_info":{"display_name":"josephine","author_link":"https:\/\/www.vtmarketsglobal.com\/en\/author\/josephine\/"},"_links":{"self":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/43765","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/comments?post=43765"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/posts\/43765\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/media?parent=43765"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/categories?post=43765"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarketsglobal.com\/en\/wp-json\/wp\/v2\/tags?post=43765"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}