{"id":296,"date":"2009-09-15T10:10:25","date_gmt":"2009-09-15T10:10:25","guid":{"rendered":"http:\/\/www.the-finance-zone.co.uk\/?p=296"},"modified":"2009-09-15T10:10:25","modified_gmt":"2009-09-15T10:10:25","slug":"uk-inflation-rate-falls-to-16","status":"publish","type":"post","link":"https:\/\/the-finance-zone.co.uk\/index.php\/2009\/09\/15\/uk-inflation-rate-falls-to-16\/","title":{"rendered":"UK inflation rate falls to 1.6%"},"content":{"rendered":"<p class=\"first\"><strong>A key measure of inflation has fallen to its lowest level since February 2005, official statistics show.<\/strong><\/p>\n<p>The Consumer Prices Index (CPI) dropped to an annual rate of 1.6% in August from 1.8% in July.<\/p>\n<p>But the Retail Prices Index (RPI) inflation measure, which includes mortgage interest payments and housing costs, rose, to -1.3% from -1.4%.<\/p>\n<p>The Bank of England aims to maintain inflation at 2% to keep both prices and the broader economy stable.<\/p>\n<p><!-- E SF -->On Tuesday, Mr King told the Treasury Select Committee that inflation was &#8220;likely to be volatile&#8221; over the next six months, initially falling further below the 2% target, then rising above it.<\/p>\n<p>&#8220;That volatility reflects base effects as well as the reversal of last year&#8217;s VAT cut,&#8221; he said.<\/p>\n<p><strong>Cheaper food<\/strong><\/p>\n<p>Lower food costs contributed to the fall in consumer price inflation, with the price of fruit, vegetables, bread and meat all decreasing, said the Office for National Statistics (ONS).<\/p>\n<p>Gas and electricity prices remained little changed, but transport costs went up, thanks to a rise in the average price of petrol.<\/p>\n<p>British Chambers of Commerce chief economist David Kern said the August inflation figures were &#8220;slightly higher than expected&#8221;.<\/p>\n<p>But he added: &#8220;The figures do not alter the basic fact that signs of recovery remain fragile, and the main policy priority is to avoid a setback.&#8221;<\/p>\n<p>Mr Kern called on the Bank&#8217;s Monetary Policy Committee to increase its quantitative easing programme to \u00a3200bn.<\/p>\n<p>He said it should also consider imposing a negative interest rate on deposits held by banks at the Bank of England.<\/p>\n<p>Vicky Redwood, economist at Capital Economics, said that despite the prospect of higher inflation next year, &#8220;the big picture is still that inflation is set to fall to very low levels next year and beyond &#8211; with a prolonged period of deflation still the main risk.&#8221;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A key measure of inflation has fallen to its lowest level since February 2005, official statistics show. The Consumer Prices<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"colormag_page_container_layout":"default_layout","colormag_page_sidebar_layout":"default_layout","footnotes":""},"categories":[25],"tags":[],"class_list":["post-296","post","type-post","status-publish","format-standard","hentry","category-inflation"],"_links":{"self":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts\/296","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/comments?post=296"}],"version-history":[{"count":0,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts\/296\/revisions"}],"wp:attachment":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/media?parent=296"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/categories?post=296"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/tags?post=296"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}