UK inflation hits more than three-year low, economy stalling

• UK inflation sank unexpectedly to a more than three-year low in December as hotels slashed prices, ramping up expectations that the Bank of England will cut interest rates as soon as this month.
• Consumer prices rose by 1.3% in annual terms compared with 1.5% in November, the smallest increase since November 2016, the Office for National Statistics (ONS) said on Wednesday.
• The pound slid below $1.30 and British government bond prices shot higher on the reading, which was below all forecasts in a Reuters poll of economists that had pointed to another 1.5% increase.
• Since the turn of the year, BoE officials have voiced concerns about the strength of Britain’s economy, raising expectations in financial markets that they could vote to cut interest rates as soon as this month.

Source: Reuters

 

 

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