Inflation falls below 2% target for first time in three years

UK inflation has dropped below the 2 per cent target for the first time in over three years, with the consumer price index (CPI) falling to 1.7 per cent from 2.2 per cent in August, as reported by the Office for National Statistics. This unexpected decrease is likely to prompt policymakers at the Bank of England to consider a slight interest rate cut in November to 4.75 per cent, with Governor John Bailey suggesting that rate cuts could be “more aggressive” if necessary. The September figure will impact tax and spending changes for next year, resulting in a 1.7 per cent increase in UK state benefits and a 4.1 per cent rise in state pensions next April due to the triple-lock policy.

Full Article