Wed, 18 Feb 2026

Wed, 18 Feb 2026 Lower fuel prices and airfares help drive inflation down

The rate at which prices are rising is slowing down, which could lead to lower interest rates.

* UK inflation fell to 3% in January, down from 3.4% in December
* Inflation has fallen to its lowest rate since March last year
* Economists expect interest rates to be cut by the Bank of England at its March monetary policy meeting
* The fall in inflation raises the likelihood that the Bank will cut its key interest rate from 3.75%
* Forecasters predict inflation will continue to fall in coming months, with government policies expected to contribute to this decline
* Economists expect the Bank to cut interest rates three times this year, leaving them at 3% by the end of 2026
* The Institute for Chartered Accountants of England and Wales (ICAEW) says the figures show a "decisive turn for the better" in the struggle against soaring prices
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