UK inflation cooled last month as the impact of the Brexit-hit pound on everyday prices began to “work through the system”.
Figures from the Office for National Statistics (ONS) show the Consumer Prices Index (CPI) eased to 2.7 per cent in February, down from 3 per cent in January.
The outcome was lower than the 2.8 per cent predicted by economists and marked the first fall in inflation since December.
Sterling’s slide since the Brexit vote has ratcheted up the pressure on household spending power, climbing from 0.6 per cent shortly after the EU referendum result to a near six-year high of 3.1 per cent in November 2017.
Slower growth from CPI eases the pressure on the Bank of England, which is widely expected to hike interest rates beyond 0.5 per cent in May.
Phil Gooding, ONS head of CPI, said: “A small fall in petrol prices alongside food prices rising more slowly than last year helped pull down inflation, as many of the early 2017 price increases due to the previous depreciation of the pound have started to work through the system.
“Hotel prices also fell and the cost of ferry tickets rose more slowly than last year, when prices were collected on Valentine’s Day when many people could have been taking mini-breaks.”
The Bank of England is expected to keep interest rates on hold at 0.5 per cent on Thursday, but the meeting will be watched closely amid expectations over another hike in May.
