U.K. Inflation Closes In on Bank of England Target as Rate Cuts Near

By Ed Frankl

The U.K.'s inflation rate neared the Bank of England's 2% target in April, opening the way for a rate cut in the coming months, although prices of services continued to rise at a pace that will concern policymakers.

Consumer prices were 2.3% higher than the same month a year earlier, easing significantly from the 3.2% rate of inflation recorded in March, the U.K.'s Office for National Statistics said Wednesday.

That reading was nevertheless higher than the 2.1% expected by a consensus of economists polled by The Wall Street Journal.

However, prices in the labor-intensive services sector continued to rise rapidly, and were 5.9% higher than a year earlier, marginally cooler than March's 6.0%.

Write to Ed Frankl at edward.frankl@wsj.com