Traders are reducing their expectations for further interest rate cuts from the Bank of England (BoE) following a surprising increase in UK inflation. Recent reports indicate that traders now foresee less than 50 basis points of additional easing in 2025. This shift in sentiment comes as the BoE remains in easing mode, with overnight rates becoming less attractive. Meanwhile, the European Central Bank (ECB) is also in a rate-cutting stance, with discussions about potentially lowering the policy rate into accommodative territory while simultaneously shrinking its balance sheet and draining reserves.