Inflation in the U.K. edged lower on the month before, giving some breathing room to a government under severe pressure from soaring borrowing costs.
Price rose by 2.5 percent on an annual basis in December, the Office for National Statistics said today, down from 2.6 percent in November. Analysts had expected it to stay at 2.6 percent. Excluding volatile food and energy prices, the annual rate fell more clearly, to 3.2 percent from 3.5 percent.
Notably, inflation in services fell to an annual rate of 4.4 percent from 5 percent. Services prices are tightly tied to wages and have been the most stubborn component of inflation as the Bank of England fights to get price it back to its mandated level of 2 percent.
