Core inflation showed some downward momentum, even if higher oil prices pushed key inflation to 2.4 per cent in March, and there is no evidence to suggest that higher prices were spreading more broadly to other goods and services, the council said. The economy is also in a position of excess supply, meaning businesses are producing more goods and services than consumers are buying, and inflation has hovered around the central bank’s target of two per cent since summer 2024. This, combined with a soft labour market, means businesses are less likely to pass higher costs to consumers.