UK inflation 'peaks' as sterling hits post-Brexit high

CPI drops to 3%

UK inflation has peaked and is now on a downward trajectory, market commentators have said, as today's figures from the Office for National Statistics (ONS) show the Consumer Price Index (CPI) dropped from a five-year high of 3.1% in November to 3% in December.

The slight decline, the first drop since June 2017, was in line with expectations and partly a result of a weaker increase in air fares compared to the same month in 2016. In addition, higher import costs because of the collapse in the value of the pound, which has been largely responsible for driving living costs up in 2017, has fallen out of the figures. Sterling has been steadily climbing since the start of the year and was today trading at $1.38, the highest level since the Brexit vote. CPI remains above the Monetary Policy Committee's (MPC) forecast of 2.7%, decreasing the li...