Britain’s unexpected inflation increase in December is unlikely to worry the Bank of England

By PAN PYLAS
Associated Press

LONDON (AP) — Inflation across the United Kingdom increased unexpectedly last month as a result of a hike in tobacco and alcohol prices. The Office for National Statistics said on Wednesday that inflation, as measured by the consumer prices index, was 4% in the year to December, up from 3.9% in November. Most economists had expected the rate to edge lower to 3.8%. But despite the increase, inflation remains sharply lower at the end of 2023 than at the start, when it stood above 10%. With inflation trending down, the Bank of England ended nearly two years of interest rate increases in August, when it left its main interest rate unchanged at a 15-year high of 5.25%.