UK inflation falls by more than anticipated to a 15-month low of 7.9%; may limit interest rate hikes

Inflation in the U.K. has fallen by more than anticipated to a 15-month low a development that may ease the pressure for the Bank of England to raise interest rates sharply over the coming months. The Office for National Statistics said Wednesday that inflation, as measured by the consumer prices index, fell to 7.9% in the year to June from 8.7% the previous month. Economists had expected a more modest decline to 8.2%. Despite the decline, inflation is still running far higher than the Bank of England’s target rate of 2%. As a result, the central bank is expected to raise its main interest rate further at its upcoming meeting in early August.