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22nd May 2024

Inflation falls to 2.3%

The latest figures from the ONS state that inflation is now at 2.3%.

Paul Butterworth, CEO at Chambers Wales South East, South West and Mid, said:

“Today’s data reveals that inflation has fallen from 3.2% to 2.3%, a significant drop which will come as a relief to many businesses in Wales.

“In Q1, inflation was the external factor which most concerned Welsh businesses according to our Quarterly Economic Survey, with just over two thirds (67%) of businesses in Wales citing it as their main concern.

“While today’s inflation figure is still higher than the Bank of England’s 2% target, the rate is continuing to head in the right direction. Businesses will be hoping that this is enough to increase the likelihood of an interest rate cut in the near future.”

David Bharier, Head of Research at the British Chambers of Commerce, said:

“Today’s data showing CPI inflation is at 2.3% is positive news that should help settle nerves and increase the likelihood of an interest rate cut in the coming months.

“Other recent data would support a rate cut, with the economy growing by a larger than expected 0.6% in the first quarter and signs the labour market is cooling. However, this has been a four-year inflation crisis, and prices are not falling, only going up at a slower rate.

“Uncertainty will persist with global conflicts and trade wars threatening supply chains. Real wage costs also continue to grow – our most recent business survey found almost half of firms expect their prices to rise over the next three months, with labour costs cited as the main driver.

“While the outlook may have brightened, the skies aren’t yet fully clear. UK firms need to see a long-term vision for the UK economy from politicians, including action on making trade easier, especially with the EU.”

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