LONDON (AP) \u2014 Inflation in the U.K. fell to a four-month low in October, official figures showed Wednesday, in a move that has raised expectations of another Bank of England interest rate cut next month.<\/p>\n
The Office for National Statistics said the annual rate of inflation, as measured by the consumer prices index, fell to 3.6% in October from 3.8% the previous month.<\/p>\n<\/p>\n
Though the rate was the lowest since June, it was a bit higher than the 3.5% that most economists were forecasting for the month. The main downward influence came from domestic energy bills, while a rebound in food prices partly offset that.<\/p>\n
Even though inflation remains above the bank’s 2% target, economists said policymakers will likely sanction a quarter-point rate cut at their next meeting on Dec. 18, especially as the labor market has weakened and economic growth has stalled<\/a>.<\/p>\n The latest inflation reading comes a week before Treasury chief Rachel Reeves delivers her long-anticipated budget<\/a>, in which she is widely expected to raise taxes to fill a multibillion-pound shortfall in the public finances.<\/p>\n Following the inflation data, Rachel Reeves said she was planning to take \u201ctargeted action\u201d in her budget to help ease the cost of living.<\/p>\n \u201cThough the conditions for a December interest rate cut are falling into place, the Budget is a last obstacle as rate-setters will want to gauge the effect of the policies announced before authorising another rate reduction,” said Suren Thiru, economics director at accounting institute ICAEW.<\/p>\n