Interest rates have been working to slow down price rises (inflation) over the past two years, so we are able to cut interest rates again today, to 4.25%. Inflation has been close to the 2% target since the middle of last year, from a peak of over 11% in 2022. We expect an increase in inflation this year. It is likely to rise temporarily, to 3.7%, partly because of higher energy prices. Inflation is expected to fall back to the 2% target after that. There is also a lot of uncertainty from global developments, partly because of changes in global trade policies. We are assessing what this could mean for UK inflation ... (full story)