"The Bank of England will be reassured by today’s fall in underlying inflation, with both services and core inflation easing. We expect underlying inflationary pressures to fall further over the coming months. That will hopefully allow the MPC to look through the expected near-term increase in headline inflation and resume cutting interest rates in the upcoming May meeting.
“Goods inflation rose to [1.2]% in February, and ongoing trade frictions could push prices higher. With the potential imposition of tariffs, the cost of imported goods could increase, creating additional cost pressures for both businesses and households.
“Headline inflation fell slightly to [2.9]%, driven by a fall in fuel prices. We expect headline inflation to rise over the coming months, driven by higher energy prices as well as a further increase in food prices.”
