The Times newspaper polled dozens of economists to get their forecasts for the year ahead.
The most common response from economists was that the Monetary Policy Committee (MPC) would cut base rate on two occasions, which was put forward by 42.5 per cent of respondents.
Notably some were even more gung ho about the prospects for greater numbers of cuts ‒ 17.5 per cent of economists predicted three cuts, with the same number forecasting four cuts. 10 per cent predicted there would be more than four cuts, with just five per cent suggesting base rate will stay at its current level.
Base rate has increased repeatedly over the last year and a half, but the MPC opted to freeze the rate at its last couple of meetings, with inflation steadily dropping. The last inflation data from the Office for National Statistics found that the consumer price index measurement for the 12 months to November had dropped to 3.9 per cent from 4.6 per cent the month before.
Base rate outlook
Some financial firms have published concrete predictions for what they expect to happen with base rate. Capital Economics for example has argued that it will be reduced to three per cent by late 2025, while Morgan Stanley has predicted it will drop to 4.75 per cent by the end of this year.
More than 80 per cent of the economists polled by The Times suggested that the economy will grow by no more than one per cent over the coming 12 months.
The economists were also downbeat on prospects for the property market. More than a third (35.1 per cent) predicted house prices will drop by between two per cent and five per cent, ahead of the one in five (21.6 per cent) who forecast a drop of up to two per cent.
However, 16.2 per cent predicted house price growth of up to two per cent, while 2.7 per cent of economists forecast a jump of between two and five per cent.
