After week of turbulence in markets, ONS data sends bond yields falling and eases pressure on chancellor

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• Dip in inflation opens way for February interest rate cut

UK inflation fell in December, giving the chancellor, Rachel Reeves, some breathing space and paving the way for the Bank of England to cut interest rates next month.

With the government under pressure on the economy, figures from the Office for National Statistics showed the consumer prices index eased to 2.5%, below a reading of 2.6% in November, meaning prices rose at a slower rate.