UK inflation drops to 1.7%, lowest in over 3 years
Prices in the United Kingdom increased by 1.7 percent over the 12 months to September, marking the lowest rate in three and a half years, as reported by BBC News. In October, the Bank of England suggested it might take a more aggressive stance in lowering borrowing costs if inflation remains under control.
7:59 PM EST, November 7, 2024
The Bank of England adjusts interest rates to keep inflation at 2 percent. In November, they were reduced to 4.75 percent, reports BBC News.
Lowest inflation in the UK in years
Inflation has dropped significantly since October 2022, when it stood at 11.1 percent. The rise in energy prices following the pandemic and Russia's invasion of Ukraine contributed to this increase. Although food prices have declined, the services sector is still experiencing price increases.
The Bank of England uses interest rates to maintain inflation at 2 percent. In November 2024, rates were lowered to 4.75 percent. Governor Andrew Bailey announced further reductions but warned against implementing them too quickly, reports BBC News.
The International Monetary Fund warns that persistent inflation may require maintaining high interest rates. In October, Bailey suggested that the Bank of England might take a more aggressive stance in lowering borrowing costs if inflation remains under control.
