UK Inflation Live: Inflation falls less than expected to 2.3% as interest rate warning issued

BT has been fined £2.8m by the industry watchdog after EE and Plusnet failed to provide clear and simple contract information to more than a million customers before they signed up.

Ofcom said that since June 2022, BT EE and Plusnet made more than 1.3 million sales without providing customers with contract summaries and information documents, affecting at least 1.1 million customers.

Average UK house prices rose by 1.8 per cent in the 12 months to March, according to official figures.

The Office for National Statistics (ONS) said it had increased the average UK house price to £283,000.

It represented a recovery in prices after house prices fell by 0.2 per cent in the 12 months to February.

Meanwhile, the ONS also revealed that private rents in the UK rose by 8.9 per cent in the 12 months to April as house price inflation slowed slightly from 9.2 per cent in the year to March.

ONS chief economist Grant Fitzner said: “Average UK house prices rose during the year for the first time since last summer.

“House prices saw year-on-year growth in every country and region except London and the South East, with Scotland recording the fastest annual growth.

“After two years of unprecedented and generally accelerating annual growth, private rental price increases have shown signs of easing.

“Most nations and English regions saw a slowdown, with a significant slowdown in London.”

Today’s inflation figures show the economy is “not out of whack yet”, Shadow Chancellor of the Exchequer Darren Jones said.

The MP for Bristol North West said inflation was moving in the “right direction” but there was still more work to be done.

He told Sky News: “Core inflation is still around 3.6 to 3.9 per cent, which is higher than markets expected. This is not out of the woods yet. It’s in the right direction, but there’s still a lot more to do.”

Mr Jones pointed to Labour’s “securonomic” agenda, which includes measures to build “domestic, secure and renewable energy”.

The shadow minister said: “The only reason headline inflation has come down to closer to 2 per cent today, even though the cost of other things remains a bit too high, is because of energy bills.

“The problem is if something happens in the world and gas prices skyrocket again, we’re going to go back to this inflationary environment with very high bills.”

Jeremy Hunt refused to be approached when he thought the Bank of England would cut interest rates.

The chancellor said the central bank would cut rates when it was “confident that it is sustainably on target”.

Analysts said the bank was likely to be more cautious about a potential cut in June as inflation fell less than expected.

Labor will be “much more ambitious” on the economy than the government if they win the election, Rachel Reeves has said.

The shadow chancellor said her party would bring “stability back to our economy” and invest more in renewables.

She said Labor would invest more in “domestic renewables so we are less reliant on Putin and dictators around the world for our basic energy needs and can lower energy bills for families and pensioners”.

Jeremy Hunt acknowledged that people probably felt worse than a few years ago.

The chancellor said that “two massive shocks” – the Covid pandemic and Russia’s war in Ukraine – are responsible for the decline in living standards.

I’m talking to ITV Good morning Britain the chancellor said: “Do people feel better now than they did a few years ago? No, because we had something that you and I never had in our lives.

“We’ve had two massive economic shocks in quick succession, so no, they don’t feel any better than they did a few years ago.

“The numbers show very clearly that since 2010 the standard of living has improved over a longer period of time, we have four million more jobs, we have attracted more investment than anywhere else in the world except China and the United States.

“The reason I say that is because it’s an election year, people are going to make decisions about the future.”

“When it comes to the important things that have an impact, the difficult decisions about flexible labor markets, about tax cuts to attract investment from overseas, the Conservative government will continue to make those difficult decisions.”

Check out some of the interviews below:

Jeremy Hunt said it was “nothing to do with me” when asked if he personally felt richer after the cost of living crisis.

He asked BBC Radio 4’s Today If he felt richer, the chancellor said, “It has nothing to do with me. It is related to my duties as chancellor.

“When I became chancellor, I know we had the Office for Budget Responsibility saying we were going to have the biggest drop in living standards ever.

“We had the Bank of England saying we were going to have the deepest and longest recession for a hundred years.

Pointing to the cost of living support the government has offered, he added: “The result of these difficult decisions, which were difficult because we ended up having to tax those decisions, but the result is that living standards have gone down. since Rishi Sunak became Prime Minister.”

In the incredulous exchange, Mr Hunt could earlier be heard insisting “me too” when presenter Emma Barnett said she was interested in people’s household finances.

Chancellor Jeremy Hunt was dealt a blow after official figures revealed borrowing topped the £20.5bn forecast in April, the fourth-highest April since records began in 1993.

The Office for National Statistics (ONS) estimated that public sector net borrowing was £1.5bn higher than in 2023, partly driven by falling National Insurance contributions.

Many people still struggle with lower living standards, the think tank said, as it warned that the worst cost-of-living crisis was “not over”.

Ben Harrison, director of the Work Foundation at Lancaster University, said: “Employees across the country may be quietly relieved to see their bills and purchases rise to their lowest level since 2021.

“But even at 2.3 per cent, inflation remains above the Bank of England’s target and many people will face lower living standards for some time to come.

“The truth is that the worst cost of living crisis in more than 40 years is far from over – most workers continue to face energy, food and housing costs that are far higher than they were three years ago.

“The threat is that interest rates remain at a 16-year high of 5.25 percent. And while there is no guarantee that the Bank of England will cut interest rates soon, low-income and precarious workers are exposed to record private rent rises and higher mortgage payments.’

An interest rate cut in June is “unlikely” after inflation fell less than expected, the Institute of Chartered Accountants in England and Wales said.

Suren Thiru, chief economic officer at ICAEW, said: “This crushing fall in inflation suggests the UK is likely to be stumbling back towards the Bank of England’s 2% target as lower energy bills had a smaller than expected impact on April’s headline rate.

“Concerns over higher-than-expected headline inflation are compounded by disappointing declines in core and services inflation, suggesting that underlying price pressures embedded in the wider economy have yet to be resolved.

“The headline rate is set to fall significantly over the summer once Ofgem’s expected drop in the energy price cap lowers people’s energy bills from July.

“Lingering concerns about core inflationary pressures mean a June rate cut is unlikely. However, these numbers may persuade more rate-setters to vote for policy easing, signaling that a summer rate cut is still possible.”