Partner Article

Inflation falls to 3%

UK inflation fell last month to 3%, the lowest rate since February 2010.

The Retail Prices Index fell to 3.5% from 3.6% in March, while the Consumer Prices Index fell to 3% from 3.5% in March, according to the Office of National Statistics.

Richard Driver, analyst for Caxton FX responded positively to the news, which he described as “good news for consumers”.

He said: “BoE Governor Mervyn King has avoided having to write an explanatory letter to the Chancellor - regarding persistently high inflation - but we expect he will have to do so again later this year.

“This morning’s UK inflation figure may well embolden some of the more dovish members of the MPC when considering further quantitative easing at their June meeting.

“Tomorrow’s MPC minutes will be more significant as far as the outlook for sterling is concerned, the market will be very keen to know how the voting pattern on QE is looking, particularly in light of Posen’s recent dovish comments.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .