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Inflation Drops to 3% in UK, While US Consumers Bear Brunt of Trump Tariffs
LONDON/NEW YORK - January saw UK inflation fall to 3%, its lowest rate since March 2025, driven by decreases in food, fuel, and airfares, according to the Office for National Statistics (ONS). Meanwhile, a new analysis from the Federal Reserve Bank of New York revealed that nearly 90% of the economic burden of President Trump's 2025 tariffs fell on U.S. consumers and businesses.
The ONS reported that the January decrease in inflation, down from 3.4% in December, raised the likelihood of the Bank of England cutting interest rates at its March monetary policy meeting. ONS chief economist Grant Fitzner noted that the drop was "driven partly by a decrease in petrol prices."
In the U.S., the Federal Reserve Bank of New York analysis found that as the average U.S. tariff on imports jumped to 13% in 2025, up from less than 3%, the costs were largely passed on to American consumers and businesses. White House economic advisor Kevin Hassett criticized the research, calling it an "embarrassment."
In other economic news, defense giant BAE Systems announced record sales for 2025, while its Lancashire sites continued to experience strikes over pay. The company's annual profit reached £2.6 billion, which Unite, one of Britain's biggest unions, called "obscene." BAE stated it had made a fair offer to staff and was engaging with unions.
In other news, the search is ongoing for 84-year-old Nancy Guthrie, the mother of "Today" show host Savannah Guthrie, who was reportedly kidnapped from her Tucson, Arizona, home on February 1, 2026. The FBI released photos and videos of an armed person in a mask near her home.
Finally, former UK chancellor George Osborne, now working for OpenAI, warned that countries failing to embrace artificial intelligence risk being left behind. Osborne, who is two months into his role at the San Francisco AI company, stated that without AI, nations "will be a weaker and poorer nation." He also suggested that workforces might seek AI-enabled opportunities elsewhere.
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