This month's inflation rate is also normally used to set April's increase in benefits including jobseeker's allowance, maternity allowance, housing benefit and universal credit.

Inflation in the U.K. has fallen to its lowest level in more than three years, a drop that has cemented market expectations that the Bank of England will lower interest rates at its next policy meetin

UK inflation drops below 2% target in September, weakening pound and making an interest rate cut in November even more likely

Inflation in the U.K. fell below the Bank of England’s 2% target in September for the first time in more than three years, making an interest-rate cut next month more likely.

UK inflation slipped below the Bank of England’s 2% target for the first time in 3 1/2 years, a fall that sets the stage for a second interest rate cut next month.

It means the annual rate prices are rising at is now below the Bank of England's 2% target, paving the way for further interest rate cuts. Lower airfares and petrol prices were the main drivers behind the surprise slowdown,

Britain's annual inflation rate fell to a three-year low in September, official data showed Wednesday, fuelling speculation that the Bank of England will resume cutting interest rates next month.

Economists polled by Reuters expected the headline rate to come in at 1.9% in its first dip below the Bank of England's 2% target since April 2021.