Inflation falls in boost to Reeves as she eyes £40billion in tax rises and spending cuts
THE Chancellor received a pre-Budget boost as inflation fell to 1.7 per cent — its lowest level in more than three years.
It dropped from 2.2 per cent in August to below the Bank of England’s two per cent target.
Experts reckon it “nails on” a 0.25 percentage point rate cut next month.
But it is a blow for millions on benefits which are pegged to September’s figure.
Rachel Reeves seeks to plug a £40billion shortfall with tax hikes and spending reductions in her October 30 Budget.
The cash will seek to protect key departments from real-terms cuts, create a buffer for economic shocks and fill what Labour have called a £22 billion black hole.
Darren Jones, Chief Secretary to the Treasury, said: “It will be welcome news for millions of families that inflation is below 2%.
“However, there is still more to do to protect working people, which is why we are focused on bringing back growth and restoring economic stability to deliver on the promise of change.”
But it emerged last night Cabinet ministers are bypassing her to go straight to No 10 in a last-minute bid to soften brutal cuts — which some warn are unsustainable.