UK Inflation Unexpectedly Falls Easing Living Standards Slump

LONDON (AP) — Inflation in Britain unexpectedly fell in the year to June, official figures showed Tuesday in a development that’s eased market expectations that the Bank of England will raise interest rates soon. The Office for National Statistics said consumer prices were 2.6 percent higher in the year to June, down from 2.9 percent the previous month. The consensus was that inflation would rise to 3 percent, which would have been a full percentage point higher than the Bank’s target rate. The surprise fall, the first since last October, was largely due to falling gas prices at the pump as lower wholesale crude prices were passed on to drivers. Despite the fall, living standards in Britain are still falling as price increases outpace wage rises. Inflation has risen sharply from last June’s 0.5 percent, largely because the country’s vote to leave the European Union triggered a 15 percent drop in the value of the pound. Though a lower pound may help exporters sell their wares in international markets, all other things being equal, it makes imported goods such as food and energy more expensive. The spike in inflation over the past year has caused concern among some rate-setters at