Inflation falls to 2.8% in enhance for Rachel Reeves forward of spring assertion | EUROtoday

UK inflation has eased greater than anticipated, official figures present, in a lift to Rachel Reeves as she prepares to ship her spring assertion.

The fee of Consumer Prices Index inflation fell to 2.8 per cent in February from 3 per cent in January, the Office for National Statistics mentioned.

The newest ONS figures come on the identical day the chancellor delivers her spring assertion. She is predicted to announce spending cuts throughout authorities departments.

Signs of easing inflation will come as excellent news to Ms Reeves amid efforts to cut back the price of residing.

Many economists had been forecasting that CPI inflation would are available in at 2.9 per cent for February.

The ONS’s chief economist, Grant Fitzner, mentioned: “Inflation eased in February. Clothing prices, particularly for women’s clothes, were the biggest driver for this month’s fall.

“This was only partially offset by small increases, for example, from alcoholic drinks.”

The constructive information could also be short-lived for the chancellor with the Office for Budget Responsibility (OBR) broadly anticipated to slash its forecast for financial development, following comparable current revisions by the Bank of England and the Organisation for Economic Co-operation and Development (OECD).

The authorities has additionally borrowed greater than beforehand anticipated with the price of these loans rising – partly as a result of international turbulence.

Treasury chief secretary Darren Jones mentioned: “Our number one mission is kickstarting growth to raise living standards for working people, that is why we are protecting working people’s payslips from higher taxes.

“In a changing world, we’re focused on delivering economic stability to secure people’s finances – freezing fuel duty, protecting the triple lock and increasing the national living wage by £1,400 a year for full-time workers, while going further and faster to drive growth through our plan for change. ”

Shadow chancellor Mel Stride mentioned: “Inflation remains higher than when Labour took office, and the Bank of England expect it to rise over the coming year.

“We left Labour with inflation bang on target. But since their no-strings-attached union payouts, record tax rises and borrowing splurge, they have pushed up the cost of living.

“The Chancellor’s choices have saddled the country with higher inflation for longer. Unless she takes urgent action at her emergency budget today, working families will continue to pay the price.”

The Trade Union Congress (TUC) said despite the ease in inflation, “the biggest challenge facing our economy is low growth”.

“After the worst slump in living standards in 200 years, households and businesses are still being hit by a sustained period of high interest rates – and it’s holding back growth,” TUC General Secretary Paul Nowak mentioned.

“Evidence from around the world shows that higher growth has been facilitated by higher consumer spending and achieved alongside low inflation.

“While all eyes will be on the chancellor today, the Bank of England also has a key role to play in reviving growth. That’s why the Bank should cut interest rates at the start of next month – and continue to throughout the year.

“Lower interest rates will help ease the pressure on households, businesses and government borrowing. They will mean more money in working people’s pockets to spend on our high streets, and more money for firms so that they feel confident to invest.”

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