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Reasons to be cheerful as inflation drops, says Atradius

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As the Office of National Statistics reveals that the inflation rate has fallen to 2.5%, we ask James Burgess, Head of Commercial and insolvency expert at Atradius for his thoughts.

“Businesses and consumers have reason to feel optimistic – UK inflation dropped unexpectedly to 2.5% in December, defying predictions of a stagnant 2.6% or an increase.  This signals brighter economic prospects for 2025.”

“With the possibility of an interest rate cut later this year further boosting the UK’s financial outlook, there is a reason to be cheerful.  However, households remain wary of rising winter bills, especially those on fixed incomes.  Combined with the Labour Government’s unpredictable actions, this news offers a cautious UK-wide lift.”

“However, business insolvencies still running high, firms must tread carefully prioritising liquidity, diversifying supply chains, and securing credit agreements with insurance to mitigate risks.”



 
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