Inflation in the United Kingdom (U.K.) has come in lower than expected at an annualized 3.4% in February, down from 4% in January and its lowest level since September 2021.
Economists polled by the Reuters news agency had expected an annual inflation rate of 3.5% for February, according to data from LSEG.
The Office for National Statistics said the decline in consumer prices came largely from a decrease in food and restaurants costs, while costs for housing and gasoline continued to rise in February.
Prices for food and non-alcoholic beverages rose by 5% year-over-year in February, down from 7% growth in January and the lowest annual rate of increase since January 2022.
The core Consumer Price Index (CPI), which excludes volatile food, energy, alcohol, and tobacco prices, came in at an annualized 4.5%, down from 5.1% in January.
The Bank of England is widely expected to keep interest rates unchanged at their current level of 5.25% at its next policy meeting on March 21.
News of the decline in the U.K. inflation rate comes a day after Canada reported that inflation in February declined to an annualized rate of 2.8%, down from 2.9% in January of this year.
Economists in Canada had widely expected inflation to increase to 3.1% in February. The Bank of Canada also targets inflation at an annualized 2%.
