Inflation down again

The Consumer Prices Index (CPI) measurement of inflation dipped to 1.1 per cent last month, new figures have revealed.

Data from the Office for National Statistics showed that CPI had dropped from the 1.6 per cent level seen in August, with a major factor being the lack of any repeat of the energy price rises of a year ago.

The fall in inflation may add weight to suggestions that interest rates will not rise for a long time yet, something that could mean more credit cards being available at a low cost.

Inflation is likely to fall below one per cent this autumn, the Bank of England said in its August inflation report.

This would mean the Bank’s governor Mervyn King will have to write a letter to chancellor Alistair Darling explaining why the CPI level was more than one per cent away from the target rate.

The report also stated: “Inflation is more likely to be below target in the medium term than above.”

Leave a Reply

Your email address will not be published. Required fields are marked *