17
Feb
Inflation falls again
Consumer prices index (CPI) inflation has fallen again, official
figures have revealed.
The official rate dipped from 3.1 per cent in December to three per
cent in January, bringing it back within the permitted level of
variation from its two per cent target rate.
However, the change was less than expected by analysts, who had
anticipated a drop to 2.7 per cent.
The Office for National Statistics said the reduction had been
influenced by lower transport and household service costs, while
the reduction in price between January 2009 and a year earlier had
been limited due to the higher than normal amount of discounting
ahead of the January sales over the Christmas period.
Such considerations may be taken into account by the Bank of
England's monetary policy committee (MPC) as it considers the
possible implications for monetary policy, with any further base
rate cut potentially lowering the cost of mortgages further.
Earlier this week MPC member and deputy governor of the bank
Charles Bean said the rate-setting body will "probably" need to act
again to keep inflation levels within the target range.
