The news is a fresh blow to Chancellor Rachel Reeves (Image: Getty)

       Rachel Reeves has been slammed by a financial expert over an "absolutely dire of affairs" after an unexpected spike in inflation.

       Another said the state of the UK’s economy was “increasingly shaky”, adding: "At this rate, the last one to leave should turn off the lights."

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       As Rachel Reeves targets our Cash ISAs - there's an even bigger threat and YOU'RE to blame

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       Rachel Reeves dealt fresh blow as borrowing soars and jobs are cut

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       'Out of her depth!' Rachel Reeves blasted as inflation jumps to 10-month high

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       As Rachel Reeves targets our Cash ISAs - there's an even bigger threat and YOU'RE to blame

       56 Comments

       Rachel Reeves dealt fresh blow as borrowing soars and jobs are cut

       31 Comments

       Rachel Reeves humiliated as experts send brutal warning over huge tax raids

       19 Comments

       Rachel Reeves could soon hike income tax rates, experts warn

       18 Comments

       Reform UK warns Rachel Reeves that doing this one thing will see inflation go higher

       35 Comments

       Rachel Reeves branded 'out of her depth' as 'pitiful' growth figures revealed

       919 Comments

       DWP triple lock warning with 'uncertainty' over next year's state pension increase

       4 Comments

       'What were they doing for 14 years?' Financial experts offer scathing verdict on Labour

       142 Comments

       Lloyds, Barclays, NatWest savers told of 7% rates after Bank of England move

       3 Comments

       Bank of England boss sends huge 3-word warning as UK economy fears soar

       77 Comments

       Rachel Reeves set to make eye-watering cuts after wiping out ￡9.9bn

       516 Comments

       Council tax fury as nine in ten areas charge maximum increase allowed

       63 Comments

       Treasury pockets ￡7bn inheritance tax but Rachel Reeves could be out for more

       6 Comments

       Pay growth accelerates for third month in a row despite drop in job vacancies

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       Mortgage interest cuts may be ‘short-lived' after inflation rise sends swap rates surging

       6 Comments

       POLL: Should Rachel Reeves quit as inflation soars to 3%?

       357 Comments

       Savvy investors flock to buy item that's 'safe' from Rachel Reeves

       2 Comments

       'Out of her depth!' Rachel Reeves blasted as inflation jumps to 10-month high

       121 Comments

       Keir Starmer is on course for an absolute shellacking for one reason more than any other

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       As Rachel Reeves targets our Cash ISAs - there's an even bigger threat and YOU'RE to blame

       56 Comments

       Rachel Reeves dealt fresh blow as borrowing soars and jobs are cut

       31 Comments

       Rachel Reeves humiliated as experts send brutal warning over huge tax raids

       19 Comments

       Rachel Reeves could soon hike income tax rates, experts warn

       18 Comments

       Reform UK warns Rachel Reeves that doing this one thing will see inflation go higher

       35 Comments

       Rachel Reeves branded 'out of her depth' as 'pitiful' growth figures revealed

       919 Comments

       DWP triple lock warning with 'uncertainty' over next year's state pension increase

       4 Comments

       The UK's inflation rate rose to 3% in January 2025, marking its highest level in 10 months.

       The unexpected increase, up from 2.5% in December 2024, has been driven by higher transport and food costs, as well as the introduction of VAT on private school fees.

       The surge in inflation has raised concerns about the UK's economic stability, especially given the country's stagnant growth and ongoing economic difficulties.

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       David Belle, founder and trader at Fink Money, said: "The law of unintended consequences strikes again. Labour's VAT increase on private schools has led to an uptick of inflation.”

       READ MORE: Rachel Reeves and Keir Starmer 'must stop punishing hardworking Brits'

       Peter Kyle grilled over Rachel Reeves' CV and the economy

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       The Labour Government had "zero understanding" of the effects of its policies and its politicians "don't care either”, said Mr Belle.

       He added: "It is no wonder we have a Chancellor who has very little experience in policy, a Treasury secretary in Darren Jones who doesn't see the need to spend ￡115 a year on Bloomberg to be able to get the best news articles and a Business Secretary whose only private sector experience is nine months as a trainee solicitor.

       "An absolutely dire state of affairs and standards are so unbelievably low. What will be interesting is now inflation is approaching the upper bound of the Bank of England's target, Bailey will have to write to Reeves to explain why it is there ... and yet it is largely all Reeves's fault."

       Andrew Bailey is the governor of the Bank of England.

       Scott Gallacher, director at Rowley Turton, said on Wednesday: "Yet more bad news for Rachel Reeves. Today’s inflation figures, coupled with virtually non-existent growth, paint a bleak picture. And it’s only likely to get worse.”

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       Mr Gallacher said Ms Reeves’s decision to increase National Insurance contributions to 15% on salaries above ￡5,000, coupled with Donald Trump’s threat of tariffs, put the Bank of England in a no-win situation of trying to curb inflation while the Chancellor strives for growth.

       He added: "Investors should take note. The UK economy is looking increasingly shaky, and anyone too reliant on UK assets may want to reconsider. At this rate, the last one to leave should turn off the lights."

       Chris Barry, director at Thomas Legal, said: "Inflation was always going to tick up again given the Chancellor hasn’t got a handle on the parts of the economy she can control and instead relies on the areas outside of her control.

       "Mortgage rates are unlikely to go up because the country isn’t growing, however we are likely to see rates reduce more slowly. Reactive as ever.”

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       Ms Reeves has faced significant criticism for her handling of the economy since becoming Chancellor after Labour’s July 2024 election win.

       In her October 2024 Budget, she announced tax increases amounting to ￡40billion, the largest since 1993.

       The hikes include raising employers' National Insurance and implementing changes to inheritance tax for rural estates.

       The Office for Budget Responsibility projected that these policies would elevate the tax burden to its highest-recorded level.

       A leaked Treasury forecast from the Office for Budget Responsibility last week suggested that Ms Reeves's fiscal headroom has been eroded due to weak growth and higher borrowing costs.

       This development could compel her to consider further tax increases, spending cuts, or alterations to fiscal rules– potentially leading to backlash from within her party.

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       As Rachel Reeves targets our Cash ISAs - there's an even bigger threat and YOU'RE to blame

       56 Comments

       Rachel Reeves dealt fresh blow as borrowing soars and jobs are cut

       31 Comments

       Rachel Reeves humiliated as experts send brutal warning over huge tax raids

       19 Comments

       Rachel Reeves could soon hike income tax rates, experts warn

       18 Comments

       Reform UK warns Rachel Reeves that doing this one thing will see inflation go higher

       35 Comments

       Rachel Reeves branded 'out of her depth' as 'pitiful' growth figures revealed

       919 Comments

       DWP triple lock warning with 'uncertainty' over next year's state pension increase

       4 Comments

       'What were they doing for 14 years?' Financial experts offer scathing verdict on Labour

       142 Comments

       Lloyds, Barclays, NatWest savers told of 7% rates after Bank of England move

       3 Comments

       Bank of England boss sends huge 3-word warning as UK economy fears soar

       77 Comments

       Rachel Reeves set to make eye-watering cuts after wiping out ￡9.9bn

       516 Comments

       Council tax fury as nine in ten areas charge maximum increase allowed

       63 Comments

       Treasury pockets ￡7bn inheritance tax but Rachel Reeves could be out for more

       6 Comments

       Pay growth accelerates for third month in a row despite drop in job vacancies

       1 Comments

       Mortgage interest cuts may be ‘short-lived' after inflation rise sends swap rates surging

       6 Comments

       POLL: Should Rachel Reeves quit as inflation soars to 3%?

       357 Comments

       Savvy investors flock to buy item that's 'safe' from Rachel Reeves

       2 Comments

       'Out of her depth!' Rachel Reeves blasted as inflation jumps to 10-month high

       121 Comments

       Keir Starmer is on course for an absolute shellacking for one reason more than any other

       63 Comments

       Bank of England interest rate worries over mortgage deals update

       Comments

       As Rachel Reeves targets our Cash ISAs - there's an even bigger threat and YOU'RE to blame

       56 Comments

       Rachel Reeves dealt fresh blow as borrowing soars and jobs are cut

       31 Comments

       Rachel Reeves humiliated as experts send brutal warning over huge tax raids

       19 Comments

       Rachel Reeves could soon hike income tax rates, experts warn

       18 Comments

       Reform UK warns Rachel Reeves that doing this one thing will see inflation go higher

       35 Comments

       Rachel Reeves branded 'out of her depth' as 'pitiful' growth figures revealed

       919 Comments

       DWP triple lock warning with 'uncertainty' over next year's state pension increase

       4 Comments

       'What were they doing for 14 years?' Financial experts offer scathing verdict on Labour

       142 Comments

       Lloyds, Barclays, NatWest savers told of 7% rates after Bank of England move

       3 Comments

       Bank of England boss sends huge 3-word warning as UK economy fears soar

       77 Comments

       Rachel Reeves set to make eye-watering cuts after wiping out ￡9.9bn

       516 Comments

       Council tax fury as nine in ten areas charge maximum increase allowed

       63 Comments

       Treasury pockets ￡7bn inheritance tax but Rachel Reeves could be out for more

       6 Comments

       Pay growth accelerates for third month in a row despite drop in job vacancies

       1 Comments

       Mortgage interest cuts may be ‘short-lived' after inflation rise sends swap rates surging

       6 Comments

       POLL: Should Rachel Reeves quit as inflation soars to 3%?

       357 Comments

       Savvy investors flock to buy item that's 'safe' from Rachel Reeves

       2 Comments

       'Out of her depth!' Rachel Reeves blasted as inflation jumps to 10-month high

       121 Comments

       Keir Starmer is on course for an absolute shellacking for one reason more than any other

       63 Comments

       Bank of England interest rate worries over mortgage deals update

       Comments

       As Rachel Reeves targets our Cash ISAs - there's an even bigger threat and YOU'RE to blame

       56 Comments

       Rachel Reeves dealt fresh blow as borrowing soars and jobs are cut

       31 Comments

       Rachel Reeves humiliated as experts send brutal warning over huge tax raids

       19 Comments

       Rachel Reeves could soon hike income tax rates, experts warn

       18 Comments

       Reform UK warns Rachel Reeves that doing this one thing will see inflation go higher

       35 Comments

       Rachel Reeves branded 'out of her depth' as 'pitiful' growth figures revealed

       919 Comments

       DWP triple lock warning with 'uncertainty' over next year's state pension increase

       4 Comments

       Speaking on Wednesday, Ms Reeves said: "Getting more money in people's pockets is my number one mission. Since the election we've seen year-on-year wages after inflation growing at their fastest rate in three years – worth an extra ￡1,000 a year on average – but I know that millions of families are still struggling to make ends meet.

       "That's why we're going further and faster to deliver economic growth.

       "By taking on the blockers to get Britain building again, investing to rebuild our roads, rail and energy infrastructure and ripping up unnecessary regulation, we will kickstart growth, secure well-paid jobs and get more pounds in pockets."