KPMG comments on today’s inflation figures

“Despite a December rise, inflation is expected to continue falling this year” says Yael Selfin, Chief Economist at KPMG UK.

"The expected fall in the energy price cap in April could see inflation returning to target by spring. Nevertheless, disruptions in the Red Sea impacting supply chains could cause further increases in goods prices adding uncertainty to the economic outlook.

“The anticipated overall improvement in the outlook for inflation, coupled with the slowdown in the domestic economy, will likely put the Bank of England in a position to begin cutting interest rates from the second half of the year, potentially lowering rates by 100 basis points in 2024.

“December’s inflation rose slightly to 4%, driven by higher tobacco duties and persistence in services inflation. Encouragingly however, food price increases continued to moderate with further slowdowns likely to lower headline inflation this year.”

-Ends-

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KPMG LLP, a UK limited liability partnership, operates from 20 offices across the UK with approximately 17,000 partners and staff. The UK firm recorded a revenue of £2.72 billion in the year ended 30 September 2022.  

KPMG is a global organisation of independent professional services firms providing Audit, Legal, Tax and Advisory services. It operates in 143 countries and territories with more than 265,000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.