"The Office for National Statistics reported that consumer price inflation fell sharply to 3.0% in January, its lowest annual reading since March 2025 and down from 3.4% in December. The decline was driven by lower transport, food, and energy costs, with core and services inflation also showing signs of softening. "This is meaningful disinflation across both headline and underlying components," Green said. "The data now give the Bank of England real latitude to act, and no credible reason to delay.""
"Households and Borrowers: Lower rates would reduce borrowing costs, improving mortgage affordability and supporting housing transactions. Financial Services: Banks could see higher lending volumes, better credit quality, and growth in consumer and SME financing. Consumption and Retail: Improved credit conditions and easing cost-of-living pressures would encourage discretionary spending, benefiting retailers, leisure, and travel sectors. Investments: Reduced policy rates would lift valuations for growth-oriented equities and real assets, particularly in technology and infrastructure sectors."
UK consumer price inflation fell to 3.0% in January, its lowest annual reading since March 2025 and down from 3.4% in December. The decline reflected lower transport, food and energy costs, and core and services inflation also softened. The reduction gives the Bank of England scope to cut the base rate from 3.75% when the Monetary Policy Committee meets on 19 March 2026, with markets pricing a quarter-point cut and potential further easing. Lower rates would reduce borrowing costs, improve mortgage affordability, support housing transactions, increase bank lending, stimulate discretionary spending, and lift valuations for growth equities and real assets.
Read at London Business News | Londonlovesbusiness.com
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