The Consumer Price Index (CPI) has fallen to its lowest level in four years as petrol, housing services and fashion products drove prices down.
February CPI fell to 1.7 per cent from 1.9 per cent in January, according to official figures. It’s the second consecutive month inflation has been below the Bank of England’s target of 2 per cent.
CPI, which measures the speed at which the prices of goods or services bought by households rise or fall, has plummeted from its September 2011 peak of +5.2 per cent.
Fashion prices, in particular men and women’s outerwear, fell 0.06 per cent year-on-year while furniture, household equipment and maintenance rose 2.4 per cent between January and February. Petrol prices dropped 0.8p a litre compared with a rise of 4p a year ago.
David Cameron tweeted: “It’s good to see inflation falling again. Our Long Term Economic Plan is helping provide stability and security For Hardworking People.”
Analysts Shore Capital suggests that “falling inflation, and potentially deflation,” is set to be a feature of the UK grocery market for some time to come.