Britain's Treasury chief believes the country cannot cut taxes until the inflation rate drops

said Friday that taming inflation is more important than cutting taxes, resisting calls from some in the governing Conservative Party for immediate tax breaks for businesses and voters.

The U.K.’s annual inflation rate hit a four-decade high of 11.1% in October, fueling a cost-of-living crisis and a wave of strikes by workers seeking pay raises to keep pace with rising food and energy prices. It has since eased but still reached a painful 10.5% in December and is the highest since the 1980s.

Hunt said he wanted Britain to be a low-tax economy but"with volatile markets and high inflation, sound money must come first" — a sign he won’t cut taxes when he makes his annual budget statement in March.The U.K. economy, like others around the world, has been rattled by pandemic restrictions and the shockwaves from Russia’s invasion of Ukraine. Britain also has suffered the self-inflicted damage of Liz Truss’ brief term as prime minister last year.

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