New pressure to cut interest rates as UK economy falters and US inflation dips

Inflation fall to 3.2% fuels calls for Federal Reserve to cut rates sooner as UK GDP figures push economy towards recession

• Downbeat GDP data adds to picture of economy going nowhere

Central banks on both sides of the Atlantic have come under renewed pressure to cut interest rates early in the new year after official figures showed an increasing likelihood of a recession in the UK and a drop in inflation in the US.

Analysts said the US Federal Reserve would struggle to resist calls for lower interest rates in the first half of 2024 after the central bank's preferred measure of inflation fell to 3.2% in November from 3.4% in the previous month.