Stubborn inflation will make it harder for the Bank of England to cut rates
Chancellor Rachel Reeves faced criticism for being "out of her depth" as UK inflation rose to 3% in January, its highest level in 10 months. This increase complicates the Bank of England's ability to cut interest rates. Shadow Chancellor Mel Stride accused Reeves of causing financial strain through tax hikes and inflationary policies. Business leaders criticized Reeves' budget, which included significant tax increases and borrowing. Additionally, concerns were raised about Reeves' past expenses and CV. Inflation in the education sector reached 7.5%, driven by higher private school fees following the government's introduction of 20% VAT on private school fees. The increase in inflation may delay potential interest rate cuts, potentially impacting mortgage rates.
