UK Inflation Drops

UK Inflation Drops.

The Office for National Statistics (ONS) has said that the Consumer Price Index (CPI) inflation fell from 1.6% to 1.5% in August. This was linked to the decline of the cost of petrol, food and non-alcoholic drinks. The most positive results came from clothing, transport services and alcohol.

Clothing saw prices rise better than a year ago as Autumn ranges started to hit shops following the summer sales season. Petrol prices fell 1.8 pence per litre between the two months this year, compared with 2 pence a year ago.

These results have meant that the Bank of England (BoE) will remain under pressure to adjust interest rates to keep CPI inflation level or below its target of 2%. Over recent months inflation has fluctuated between 1.5% and 1.9%.

Wages are not rising as well as inflation, only increasing 0.6% in the months to June compared with the year before.