The RBS have revised their forecast for BoE Bank Rates and are now forecasting a 25bp hike in May. A May hike would mark a turning point in the monetary policy cycle but RBS expects the process of Bank Rate normalisation to be incremental and policy to remain accommodative for several years. By end-2011 RBS forecasts the Bank Rate to stand at 1%, with rates edging up to 1.5% by end-2012.
Source: RBS
