(qlmbusinessnews.com Thurs 21th, 2024) London, UK —
Cost of Living Relief as UK Inflation Cools to 3.4%
British households were offered a glimmer of respite from the cost of living crisis as latest figures showed inflation falling to 3.4% in February – its lowest rate in over two years.
The dip from 4% in January marks welcome progress in the battle against soaring prices, with the annual rate now at its most modest level since September 2021 as price rises for essentials like food and eating out slowed sharply.
According to the Office for National Statistics, more affordable groceries and restaurant bills were key drivers behind February's drop. Further easing was seen across alcohol, tobacco, clothing and footwear costs.
However, the data painted a mixed picture with housing expenses and fuel continuing their relentless surge, piling financial pressure on stretched family budgets.
Private rental prices in particular jumped a staggering 9% year-on-year – the largest such increase since records began in 2015 – compounding the challenges faced by Britain's renters.
While the downward inflation trajectory will be cautiously welcomed, price growth remains elevated compared to the Bank of England's 2% target, with many households braced for another round of above-inflation utility, mobile and insurance bill hikes in April.
Economist Grant Fitzner acknowledged the promising “trend” but warned prices are still rising, albeit at a less alarming pace than recent peaks.
For small business owners like Shaine Tench from Crewe, crippling overheads like soaring fleet insurance mean difficult decisions loom on whether to pass on costs or pause growth plans.
The figures landed ahead of the Bank's upcoming interest rate call on Thursday, where rates are expected to be held at 5.25% as policymakers assess if enough has been done to tame inflation.
Chancellor Jeremy Hunt claimed households could now “heave a sigh of relief” but rebuffed calls to confirm potential tax cuts, stating it was “far too early” with an election looming.
For the opposition Labour party, the figures underlined how “working people are worse off” under 14 years of Conservative economic stewardship.
As the cost of living firefight rages on, the easing inflation rate will provide temporary balm – but householders know more will be needed before they escape the squeeze on their finances.
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