Inflation in Britain fell more than expected in February

New Delhi. Official data on Wednesday showed UK price rises slowed more than expected in February, raising hopes the Bank of England could start cutting interest rates in the next few months. The Office for National Statistics said Inflation as measured by the consumer price index fell to 3.4 percent from 4 percent in January, its lowest level since September 2021. The agency said the decline was mainly driven by softening food prices. Inflation is still above the Bank of England’s 2 percent target but the direction of the move is clear.

Inflation topped 11 percent at the end of 2022 in the wake of Russia’s invasion of Ukraine, which led to a sharp rise in energy costs. The bigger-than-expected decline came a day before the Bank of America’s nine rate-setters announced their latest interest rate decision. Has come first. The view in financial markets is that they will keep the key interest rate at a 16-year high of 5.25 percent. The minutes of the meeting will be evaluated to see how far policymakers are considering cutting interest rates, which could help mortgage Rates should be lowered. Suren Thiru, economics director of the Institute of Chartered Accountants in England and Wales, said: “This significant fall is evidence that Britain is fast approaching the finish line in its fight against rising inflation. “

Like the Fed and other central banks around the world, the Bank of England aggressively raised interest rates to near zero in late 2021 to combat price increases, first prompted by supply chain issues during the coronavirus pandemic and Then there was an increase due to Russia’s invasion of Ukraine. food and energy costs.Higher interest rates – which cool the economy by making it more expensive to borrow, thereby reducing spending – have contributed to lower inflation around the world.Britain’s ruling Conservative Party expects Low inflation and falling interest rates could become a good factor ahead of the general elections, which are scheduled to be held by January 2025. Opinion polls show the main opposition Labor Party is ahead and headed for a major victory. The Conservatives, who have been in power since 2010.