UK’S HUNT SAYS WILL STICK TO PLAN THAT IS WORKING Inflation Holds at 4.0%
Finance Minister Jeremy Hunt said it is “time to stick to a plan that is clearly working” after official data showed British consumer price inflation unexpectedly held steady at an annual rate of 4.0% in January, defying forecasts of a rise.
Hunt said it was still too high however and needed to reach 2% to relieve pressure on families. Economists s had forecast an increase to 4.2%.
Consumer price inflation – which was higher in Britain than in other rich economies until recently – is expected to fall further in the coming months, paving the way for the BoE to start cutting borrowing costs from their 16-year high.
Sterling weakened against the dollar and the euro immediately after the inflation data was published.
Britain’s core inflation, which excludes volatile food, energy, alcohol and tobacco prices, was also unchanged at 5.1%, the Office for National Statistics said.
High inflation has impacted British households’ living standards over the last couple of years, contributing to the electoral challenge facing Prime Minister Rishi Sunak whose Conservative Party is lagging far behind the opposition Labour Party in opinion polls.