UK inflation remains unchanged at 4% in January – what this means for you

The British inflation rate remained at 4% in January, which was a blow to household budgets.

The annual rate at which prices rise remained at the same level last month, figures from the Office for National Statistics (ONS) show.

It comes after inflation unexpectedly rose to 4% at the end of last year.

It was the first time since February 2023 that interest rates rose and it came as a surprise to many economists.

The latest figures show that prices are rising at the same pace as the month before.

Inflation is a measure of how the price of goods and services has changed over the past year.

Inflation declined over the course of 2023, compared to an eye-popping 11.1% in October 2022, driven by soaring gas and electricity prices.

But the rate is still higher than the Bank of England's 2% target rate.

The Bank is raising interest rates in an attempt to control inflation, raising borrowing costs for millions of homeowners.

In January it kept interest rates unchanged at 5.25%, following the recent fall in inflation.

What it means for your money

High inflation means the cost of daily necessities, such as food and energy, is rising, which means your money doesn't go as far.

The BoE, Britain's central bank, may increase the so-called base interest rate in an attempt to bring it down.

While it means people with savings will see a boost, it also means interest rates on mortgages will rise, increasing pressure on homeowners.