Is the Bank of England heading for a policy error?

As the Bank of England considers a potential rate cut, it faces the challenge of balancing recent positive inflation data with ongoing economic uncertainty. The latest UK headline inflation dropped to 2.0% in May, hitting the target for the first time in three years. However, with persistent services inflation and looming fiscal uncertainties, the risk of a policy misstep is significant. This analysis explores these complex challenges and the potential implications of a Bank of England policy error.