Bank of England expected to hold rates and warn on inflation

Wage growth fears likely to make Bank policymakers wait before cutting interest rates from 5.25%

Bank of England policymakers are expected to hold interest rates at 5.25% when they meet today, but a rapid fall in inflation could mean a cut in the cost of borrowing comes as early as June.

Analysts said revised forecasts for inflation were likely to show a steep drop in prices growth over the next six months, prompting bets in financial markets that the Bank's monetary policy committee (MPC) will make several cuts to interest rates in the second half of the year.