UK Inflation rate falls to 1.7%. The Office for National Statistics says the Consumer Price Index for August fell from 2.1% to 1.7%
The inflation rate has fallen noticeably in August down to its lowest level since late 2016.
The Bank of England’s inflation target is 2%
The Bank of England raises interest rates if inflation is too high, or it thinks it is heading that way. It will cut rates if it thinks there is a danger of economic growth slowing too much or inflation being too low.
Interest rate cuts make it more attractive for business to borrow to invest and households to borrow to spend. The Bank of England is perhaps the main in trying to prevent a recession and promoting a recovery if there is a downturn.
This will be unwelcome news for the Bank of England but good news for the consumer, who will benefit as lower inflation translates to lower retail prices.
Interest rate cut due soon?
Will there be another interest rate cut soon to help control inflation and to help fight off economic slowdown or recession should it comes to visit?