UK inflation at 2.5% in December...below expectations

Britain's consumer price index (CPI) growth was 2.5% per annum in December last year, the Office for National Statistics said.

It's down from 2.6% in November last year and below market expert expectations of 2.6% surveyed by Reuters.

The service price sector rose to 4.4%, its lowest since March 2022, down sharply from 5% in the previous month.

That's unexpected good news for Keir Starmer's government, which faces financial market instability, including a surge in government bond rates and a fall in the value of the pound, on fears of "stagflation," which means rising prices amid a recession.

However, Treasury Secretary Rachel Reeves said after today's data release that there is still much work to do to stabilize prices.

Prices are now higher than the Bank of England's target of 2.0% a year, and experts are warning of a possible rise to 3% earlier this year.