LONDON (AFX) - Chancellor of the Exchequer Gordon Brown said the UK's low-inflation environment looks set to continue "in the years to come".
Yesterday's Bank of England rate cut was possible because the UK had the lowest inflation rate for 30 years and "because, in recent years, despite the rise in oil prices, we have, with monetary and fiscal discipline, managed to keep inflation under control", Brown told a business audience in Nottingham.
The BoE's Monetary Policy Committee cut its repo rate by 25 basis points to 5.75 pct in its first reduction for 20 months. Annual inflation dropped to 2.0 pct in December, well below the BoE's target of 2.5 pct.