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Econ Fact of the Week
UK Inflation Drops to 2.1%, the Lowest in Over 3 Years
In August 2025, the UK’s inflation rate fell to 2.1%, the lowest it has been since early 2022. This is very close to the Bank of England’s target of 2%, which is seen as a sign of a healthy, stable economy.
Over the past few years, inflation has stayed high due to a mix of rising energy prices, trade issues after Brexit, and strong wage growth. High inflation made everyday goods more expensive and pushed up interest rates.
Now that inflation is falling, the Bank of England might soon lower interest rates, something many economists expect later this year. Lower rates could mean cheaper borrowing, which would help businesses and consumers alike.
To know more about interest rates an Inflation, check out the article 'Why Can’t We Just Print More Money?' on the Blog now!