U.K. inflation fell by more than expected to its lowest level since September 2021 in February, with a further easing of food prices leading the way.

The consumer price index rose by 0.6 percent from January and was up 3.4 percent from a year earlier, according to Office for National Statistics data released on Wednesday, fractionally below consensus forecasts for 0.7 and 3.5 percent respectively. Inflation had been running around 4 percent, twice the Bank of England's target, for three months before that.

The news is a bonus for the Bank of England but it is unlikely by itself to prompt any cut in interest rates when the Monetary Policy Committee announces its decisions on Thursday. The pound and U.K. stocks were little changed after the news.

"The path to target remains intact," said Deutsche Bank analyst Sanjay Raja in a note to clients. He added that he expects inflation to fall to around 2 percent by April, when energy regulator Ofgem's new price cap will push down average fuel bills. That should allow the bank to start cutting the Bank Rate already before summer, he argued.

It's also a welcome development for the U.K. government, which badly needs to put an end to a cost-of-living crisis before facing the voters later this year. Inflation for food and energy, two volatile items that have the most impact on consumers' perceptions, are now firmly in retreat.

"On a month-on-month basis, producer prices for food have either been flat or slightly negative for a while now and that’s feeding through to consumers very noticeably," said ING analyst James Smith. "The annual rate of food inflation now sits at 5 percent and we think that could be below 1 percent by June."

However, the figures weren't all good. Services inflation, which has taken over from food and energy as the driver of the headline rate, only eased marginally to 6.0 percent from 6.1, due in large parts to another big rise in housing rents. Various top officials at the bank have warned that 'sticky' services inflation is likely to delay and slow the pace of rate cuts.

In addition, the producer price index, which is generally a reliable indicator of future inflation, rose by more than expected to be up 0.4 percent on the year, while the previous month's data were also revised higher.