Interest rates as we speak: Bank of England expected to hold rates despite inflation tumbling

The common month-to-month lease within the UK is now £1,238, which is £102 greater than 12 months in the past.

However, common home costs decreased by 0.6 per cent within the 12 months to January 2024. In England, they decreased by 1.5 per cent as additionally they did in Wales by 0.8 per cent, however elevated in Scotland by 4.8 per cent.

UK inflation has fallen again to 3.4 per cent, the bottom degree in additional than two and a half years, boosting hopes that the Bank of England may look to minimize curiosity rates in the summertime.

The larger-than-forecast decline is a major boon for Rishi Sunak, who made lowering inflation one of his key financial pledges. Getting inflation down to 2 per cent can be a key goal for the Bank.

This is the bottom degree inflation has been at since September 2021. Despite inflation falling it doesn’t imply that costs are falling, solely that they’re rising at a slower tempo.

Mr Sunak was buoyed by a fall in inflation to 3.4% in February, down from 4% in January, with Chancellor Jeremy Hunt hinting the improved financial image may lead to tax cuts and reductions in curiosity rates – which may enhance voters’ funds within the run-up to an election later this yr.

The Prime Minister mentioned: “I do believe that at the start of this year we have turned a corner after the shocks of the past few years and we are in a new economic moment and 2024 will prove to be the year that the economy bounces back.”

He sought to play down considerations about stories of a backbench plot to oust him as Conservative chief within the interview, insisting that his focus was on the nation at giant.

“Look, these things don’t infuriate me because you know what, fundamentally, I’m just not interested in Westminster gossip,” the Prime Minister mentioned.

“It’s just that is not what’s important. What’s important is the future of our country, and people’s financial security and the peace of mind that they rightly deserve… That’s what I get up every morning to do and that, I will work every hour God gives to deliver for people.”

A defiant Rishi Sunak insisted he would nonetheless be Prime Minister after May’s native elections as he dismissed “Westminster gossip” about Tory plots towards his management.

Mr Sunak addressed Conservative MPs in Parliament as he battled to assert his authority and rally his get together behind him following days of hypothesis about his place.

And in a BBC interview he insisted his plan for the nation was working and “2024 will prove to be the year that the economy bounces back”.

Speculation is rife that insurgent Conservative MPs are lining up potential successors ought to Mr Sunak face a no confidence check earlier than a basic election.

Heavy defeats for the Tories in May’s native elections may heap strain on Mr Sunak.

But the Prime Minister mentioned he would nonetheless be in No 10 after the native elections as a result of “the things that we are doing are making a difference”.

Asked whether or not he could be Prime Minister after May, he informed the BBC: “Yes. Because the things that we’re doing are making a difference, right.

“And there’ll always be noises off, there’ll always be people focused on what’s happening at Westminster. But that’s not, when I go around the country every week talking to people, that’s not what they talk to me about.

“What they are talking to me about is making sure that inflation continues to come down, that energy bills and mortgage rates are falling, that we are cutting taxes so that their family have more money in their bank accounts every month… That’s what we’re delivering on the economy.”

Mr Hunt mentioned: “Inflation has not just fallen decisively but is forecast to hit the 2% target within months.

“This sets the scene for better economic conditions which could allow further progress on our ambition to boost growth and make work pay by bringing down national insurance as we work towards abolishing the double tax on work.”

He informed broadcasters: “As inflation gets closer to its target, that opens the door for the Bank of England to consider bringing down interest rates, that brings down mortgage rates, that makes a very big difference.

“It’s far too early to know whether we’ll have another fiscal event before the election, but what I would say is that what you can see is the difficult decisions the Government has taken over the last year are paying off.”

Inflation eased again by greater than expected in February, boosting hopes {that a} minimize in curiosity rates might be on the playing cards inside months.

Official figures confirmed Consumer Prices Index (CPI) inflation fell to 3.4% in February, down from 4% in January and the bottom degree since September 2021, thanks to the associated fee of meals and consuming out rising extra slowly.

Chancellor Jeremy Hunt hinted that the “decisive” drop in inflation may give him room to additional cut back nationwide insurance coverage, however performed down solutions that this may imply pre-election tax cuts in an autumn assertion.

Experts mentioned inflation is now possible to fall again beneath the Bank of England’s 2% goal in April or May, thanks to the scheduled 12% fall within the vitality worth cap on April 1.

This may pave the way in which for the Bank to begin reducing rates probably as early as June, in accordance to many economists.

The Bank of England’s determination on what it ought to do with curiosity rates comes after better-than-expected inflation figures.

The figures launched by the Office for National Statistics (ONS) on Wednesday morning confirmed that inflation was 3.4 per cent in February, which is barely decrease than the three.5 per cent predicted by economists.

This is the bottom degree inflation has been at since September 2021. The newest figures are transferring regularly nearer to the BoE’s 2 per cent inflation goal.

Hello and welcome to the Independent’s reside protection of the Bank of England’s newest determination on what they need to do with curiosity rates, that are at present at 5.25 per cent.

Speculation is rife in monetary markets that policymakers will hold regular and select to maintain curiosity rates on the identical degree.

Read our preview of the choice right here: