With inflation ticking back up and interest rates hanging in the balance, February has been full of economic uncertainty. In this edition of Citrus Bites, Richard Harris dives into the latest developments and how they impact your money.
Inflation Update – A Surprise Increase
In January, inflation (CPI) jumped from 2.5% to 3%, a significant rise driven by:
Higher food prices – Meat, bread, and cereals were key contributors.
Energy costs increasing – A rise in energy prices added to household expenses.
This puts the Bank of England in a tough spot ahead of their March 20th base rate decision. Will rates hold, or will inflation force them to delay cuts even further?
What’s Happening with Wages & Employment?
- Unemployment is creeping up slightly, but vacancies are still falling.
- Wages are rising at 6%, adding pressure on inflation.
- A dilemma for the Bank of England – Lowering rates too soon could reignite inflation!
What Can You Do Before April 5th?
With inflation uncertainty and changing tax rules, there are key financial moves to consider before the tax year ends. Here are five steps to take now:
- Max Out Your ISA – Use your £20,000 tax-free ISA allowance before it resets.
- Boost Your Pension – Contributions up to £60,000 can qualify for tax relief.
- Utilise Capital Gains Tax Allowance – The exemption is only £3,000 this year – use it or lose it!
- Take Advantage of Inheritance Tax Gift Allowances – You can gift up to £3,000 tax-free annually.
- Make Charitable Donations – Claim Gift Aid and tax relief on donations.
What’s Next?
- Bank of England decision on March 20th – Will they hold or cut rates?
- Act before April 5th – Many allowances are “use it or lose it”!
Watch the full episode now
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