Interest rates unlikely to reach 4.75% by next summer, say City economists

The Bank of England on Threadneedle Street, London. The monetary policy committee is expected to raise rates to 4% next month. Photograph: Corey Rudy/Reuters

Financial markets are wrong to predict the Bank of England will raise UK interest rates by a full percentage point or more by next summer, City economists believe.

According to market-implied interest rate expectations, the Bank is likely to raise interest rates at least four times over the next year, lifting the bank rate from 3.75% today to 4.75% by the end of July, and possibly to 5% – meaning five rises – by December 2027.