The chancellor's Autumn Budget could cut inflation by half a percentage point in 2026, a Bank of England deputy governor has said.
Clare Lombardelli told the Commons' Treasury committee that measured announced by Rachel Reeves will slow the rate at which prices are increasing from April next year.
Capping fuel duty, slashing energy prices and freezing rail fares would impact prices increases, she told MPs.
Official forecaster the Office for Budget Responsibility (OBR) has said the measures in Reeves' Budget will reduce inflation by 0.4%.
UK inflation currently stands at 3.5%, while the OBR forecasts it will drop to 2.5% next year, before returning to the Bank's 2% target from 2027.
Ms Lombardelli, the Bank's deputy governor for monetary policy, said: "We think it will reduce inflation by between 0.4% and 0.5% for a year from the second quarter of 2026.
"That is purely a mechanical effect of the changes in energy prices, fuel duty, lesser electric vehicles and rail.
"That will just shift inflation. That is by far the biggest impact for us."