UK Inflation Eases from 40-Year High but Households Face Further Economic Squeeze
• Inflation finally eased back from peak of 10.1% but remains well above 2% target, leaving economy on "knife edge" • Interest rates hiked aggressively to 5.25% to tame inflation, hitting homeowners with higher mortgage costs • Prices drops slowed and wage growth outpaced inflation, offering some respite to households • Further mortgage rate rises to come in 2024/5, threatening recession and stagnation • First rate cut possibly from Spring 2024 but inflation outlook uncertain and more economic pain still to come