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UK inflation fell by more than expected in February, driven by a drop in the prices of clothes and shoes.<\/p>\n
Inflation decreased to 2.8%, down from a rate of 3% in January, according to the Office for National Statistics (ONS).<\/p>\n
The latest figures come ahead of Chancellor Rachel Reeves’ Spring Statement, where she will set out her economic plans.<\/p>\n
Grant Fitzner, chief economist at the ONS, said women’s clothing “was the biggest driver for this month’s fall”.<\/p>\n<\/div>\n
“This was only partially offset by small increases, for example, from alcoholic drinks.”<\/p>\n
The ONS said discounted clothing, in particular, had helped cause the drop.<\/p>\n
Economists had expected that inflation would remain at 3% in February. However, despite the fall, the figure is still above the Bank of England’s target of 2%.<\/p>\n
The rate of price rises is also expected to increase in the months ahead, with council tax and energy and water bills all set to rise in April.<\/p>\n
In addition, a recent survey from the ONS found that almost a half of businesses are considering price rises as they brace for next month’s tax rises and increase in the National Living Wage.<\/p>\n
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said the Bank of England was unlikely to cut rates at its next meeting because February’s fall was “not an enormous change” and inflation “is still significantly above target”,<\/p>\n
“Although policymakers won’t want to keep rates too high for too long given the stagnation in the economy, they are set to stay cautious with a rate cut looking more likely to come in June and another later in the year”, she said.<\/p>\n<\/div>\n