The small uptick in prices to 4 per cent in the year to December does not mean that the cost-of-living crisis is back. The markets have been betting on a reduction as soon as May but that could now be put back. Nevertheless, there could be a further rise in the index this month as a result of a 5 per cent increase in the energy price cap. After that, barring unexpected accidents, there is little reason that the consumer prices index should not hit the 2 per cent target by summer. The bottom line for most Britons is that wages are more than outpacing inflation and consumer prices and interest rates should fall as the year progresses.
