Lower food and fuel prices drive inflation down to 3%

The UK's inflation rate fell to 3% in January, down from 3.4% in December, driven by a decrease in food, fuel and airfare prices.

Economists said the decrease raised the likelihood the Bank of England will cut interest rates at its March monetary policy meeting.

The Office for National Statistics (ONS) said the "marked" fall in January took inflation to its lowest rate since March 2025.

Although the rate of inflation has fallen, prices themselves are not coming down, but simply rising at a slower pace.

ONS chief economist Grant Fitzner said: "Inflation fell markedly in January to its lowest annual rate since March last year, driven partly by a decrease in petrol prices.