The Bank of England is expected to lower interest rates by a quarter-point this week. However, there is uncertainty about future policy adjustments due to the potential re-election of Donald Trump.
Karen Ward, chief market strategist for Europe at JP Morgan Asset Management, warns that Trump's aggressive tariff plans could lead to significant fiscal responses from Europe and China, potentially causing increased inflation.
On the other hand, Citigroup Inc.'s chief UK economist, Ben Nabarro, suggests that a second Trump term may weaken UK growth. He points out that trade diversion from China could result in a flood of inexpensive products into the UK market, which could slow down price increases.