Photograph courtesy of 401 Calculator
The Consumer Price Index (CPI), a measure of the UK’s inflation, fell to 2.7% in the year to August, down from 2.8% in July.
Inflation has been broadly steady since spring 2012 according to the Office of National Statistics [PDF], with the fall a result of a slower rise in the cost of transport, particularly petrol and air travel, and clothing.
At 2.7%, inflation still outstrips the rise in wages, which have risen by 1.0% over the last 12 months.
The Bank of England uses CPI in determining its interest rates, and targets a 2% figure. However, they are currently postponing any raise in interest rates due to the high levels of unemployment.
1 Comment
Hi,
UK inflation rate falls to 2.7% in August. Based on the price of shoelaces and drawing pins this is welcome news. Obliviously things like the rocketing price of houses and accommodation do not count as well as food prices and the decrease in income. That the interest rate is lower than the rate of inflation is just a fairy tale. Well done George.