Check out our latest economic review for December.
Our latest edition reads that the latest consumer price statistics reveal a significant drop in
the UK headline rate of inflation, although the BoE Governor has warned that getting the rate to continue falling back to target will be “hard work.”
Data published last month by the Office for National Statistics (ONS) showed the Consumer Prices Index (CPI) 12-month rate – which compares prices in the current month with the same period a year earlier – stood at 4.6% in October. This represents a significant fall from September’s 6.7% figure and was below analysts’ expectations which pointed to a rate of 4.8%. ONS said the decline, which was the largest monthly drop since April 1992, was mainly driven by a steep reduction in household energy bills compared to last year’s levels. There was also some evidence of a wider softening of price pressures, with some sectors, such as overnight hotel accommodation, witnessing a notable easing in annual inflation rates.
You will aslo read about Revised forecasts from the Office for Budget Responsibility (OBR) suggesting the UK economy is set to grow more slowly over the next two years than previously predicted.
Chancellor Jeremy Hunt unveiled the independent fiscal watchdog’s latest projections during his Autumn Statement delivered on 22 November. The updated forecast predicts the economy will expand by 0.6% this year and then by 0.7% in 2024 and 1.4% in 2025. While the 2023 figure is a
significant improvement on the OBR’s previous prediction of a small contraction, the other two figures both represent large downgrades.