The biggest monthly drop in the price of gas since the 1980s helped drag inflation down to 1.8% in January – the lowest level in two years. That the cost of things has fallen will be welcome news for British households who have felt the effects of austerity, but it is worth bearing in mind that real wages are still 5% lower than they were in 2008. Other contributors to the drop included lower petrol prices and a drop in the cost of hotel rooms. There are some who believe inflation will continue to drop, which would be even better news for consumers.
A no-deal Brexit is still on the table according to the government, as the ERG refuses to support May’s motion on Brexit tonight. They are unhappy that no deal is implicitly ruled out in the motion, which they believe removes the UK’s negotiating leverage in Brussels. That the UK appears to not have any negotiating leverage anyway is moot in these uncertain times. May history show what happened over the past two years and who is responsible.
Today is a quiet one for UK economic data, but there will no doubt be plenty to talk about as the Commons prepares for another Brexit vote. It only remains for us to wish you a Happy Valentine’s Day.
