BUSINESS LIVE: Inflation hits 3%; HSBC to slash costs; BAE Systems profits soar

BUSINESS LIVE: Inflation hits 3%; HSBC to slash costs; BAE Systems profits soar
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BUSINESS LIVE: Inflation hits 3%; HSBC to slash costs; BAE Systems profits soar
Published: Feb, 19 2025 07:38

Summary at a Glance

'Core inflation, the measure that strips out volatile components such as food and energy, saw an equally large rise, increasing to 3.7 from 3.2 per per cent last month, moving even further away from that magic 2 per cent target.

The consumer price index jumped to 3 per cent last month, up from 2.5 per cent in December and ahead of forecasts of 2.8 per cent, according to the Office for National Statistics.

This may give the Bank of England pause for thought on future interest rate cuts, with the current level far in excess of its 2 per cent targeted level.

'To get quarterly cut hopes back on track we really need to see a sustained softening in services inflation but, given how much staff costs weigh on UK services businesses, the upcoming rise in employer NI contributions could put a spanner in the works.

UK inflation accelerated faster than expected in January on the back of higher transport and education costs, with fresh data further complicating the path for Bank of England interest rate cuts.

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