Crowds of buyers and guests at Oxford Street on August 28, 2024 in London, Great Britain.
Mike Kemp In the pictures Getty images
According to data published by the National Statistics Office (ONS) in the UK, it fell slightly to 2.8%, on Wednesday, on Wednesday, passing slightly below the expectations of analysts.
Economists surveyed by Reuters expected that the consumer price indicator would reach 2.9% in twelve months to February.
The inflation rate increased rapidly to 3% in January, after a decline to a lower than expected 2.5% in December.
Basic inflation, which excludes more unstable energy, food, alcohol and tobacco, increased by 3.5% in February, compared to 3.7% in January.
“The slowdown of the rate to February 2025 reflected the carts down from the four divisions and the contribution from the five divisions. The biggest contribution down comes from clothing and footwear, apartment and home services as well as recreation and culture” The agency said.
Sterling fell by 0.1% in relation to the dollar, reaching 1.2925 after the data is issued.
The latest data will be food for the Bank of England, who left interest rates at 4.5% at a monetary policy meetingBecause the economy of Great Britain is struggling with uncertainty about global trade policy, possible tariffs, forecast temporary increase in inflation and approaching stagnation at home.
In the statement at that time, the Central Bank said: “The uncertainty of global trade policy intensified, and the United States presented a number of tariff ads that some governments answered.”
“Other geopolitical uncertainties have also increased, and the indicators of the financial market variability have increased all over the world,” he added.
Boe already had He warned in February that he expected inflation to increase to 3.7% In the third quarter of this year, as the energy costs are accelerated. He also increased the growth forecast by 2025 for Great Britain at 0.75%.
Slow down “red herring”
Inflation data will be carefully observed by the British government, when Minister of Finance Rachel Reeves is preparing for the subsequent update of legislators regarding his plans for expenses and taxes, as well as the economic prospects of the nation.
Reeves is expected to announce billions of pounds of expenditure cuts as a way to close a budget deficiency caused by the increase in the cost of the loan from the moment its first fiscal plan is published.
The Minister of Finance has already swore to stick to her “fiscal principles” imposed by her to ensure that daily expenses will be met with tax income and that public debt will fall as a share in economic production up to 2029-30.
Reeves' Spring Instructions It is to be presented in the parliament about 12.30 time in London and will be delivered along with the latest economic forecasts from the Budget Bureau (OGR), an independent public supervision authority of the country's public supervision.
Obr is Apparently it was expected To reduce Great Britain's growth forecasts to 2025 and reduce its previous 2% estimates by half, with lower production they exert pressure on the requirements for government loans and forces Reeves to reduce public expenditure by about 10 billion pounds ($ 12.96 billion).
After releasing the inflation data, the main secretary of treasury Darren Jones said that the priority of the financial ministry was “starting growth to increase living standards for working people” and “ensuring economic stability to secure people's finances” in what the government describes as “a changing world”.
Paul Dales, the chief economist in Great Britain at Capital Economics, warned that the latest inflation print would not help Boe or Chancellor Reeves.
“CPI inflation discount from 3.0% in January to 2.8% in February is a bit of red tracking, because inflation will probably return above 3% in April and about 3.5% to September. This is the risk of pouring wages will probably mean that the Bank of England press the pause with percentage rates at some point in the coming months,” said Dales in Wednesday's comments.
“If this would cause a further increase in the expectations of the market rate, today may not be the only moment this year that the chancellor must tighten the fiscal policy to compensate for the higher costs of the loan,” he added.
Dales said that the consumer price indicator may return to about 2.5% in March, but it would be a short relief, with the rising energy costs probably increased inflation, and in September potentially 3.5%.
“It would be slightly lower than the bank's forecast at 3.7% and we suspect that the poor economy will charge wage growth and inflation.