UK Inflation Rate Falls to 3% in January, Meeting Expectations

The United Kingdom's inflation rate decreased to 3% in January, aligning with market expectations and marking a 10-month low. According to RTHK, this decline represents a 0.4 percentage point drop from the previous month, driven by slower price increases in transportation, food, and non-alcoholic beverages. The easing inflation has strengthened market anticipation that the Bank of England may soon resume interest rate cuts. Last month's Consumer Price Index (CPI) fell by 0.5% month-on-month, as expected, following a 0.4% increase in the previous month. Excluding energy, food, and tobacco, the core CPI rose by 3.1% year-on-year, slightly above expectations but still the lowest since September 2021. On a monthly basis, the core CPI decreased by 0.6%, slightly less than the market's forecasted 0.7% drop.