UK rates have yet to start coming down, although speculation is mounting that the Bank of England could trim them as early as this month.
UK inflation has fallen to 2.3%, a long way down from its peak of over 11% in late 2022.
Last month the International Monetary Fund suggested the Bank of England should cut rates from their current 5.25% to 3.5% by the end of the year.
However, George Godber from Polar Capital said the upcoming election in the UK would “complicate” the Bank of England’s next decision on 20 June.
The Bank is politically independent, but the Conservative government had made falling interest rates part of their promise to voters, which could influence “mindsets”, Mr Godber said.
“If they cut it’ll be political, if they don’t cut it’ll be political,” he said.
The US Federal Reserve is also expected to cut rates in the coming months, although the latest US inflation figure is higher, at 3.4%.
The Fed was likely to make its first move on rates ahead of the immediate run-up to voting in November, Mr Godber said.
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