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UK inflation on the wane

UK inflation on the wane

Category: Economy

Updated: 19/05/2009
First Published: 19/05/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Annual inflation in the UK dropped in April due to falling demand from consumers caused by the economic downturn.

The Consumer Prices Index (CPI) dropped by 0.6 percentage points last month to stand at 2.3 per cent, down from 2.9 per cent in March, figures from the Office for National Statistics (ONS) have revealed.

The level of annual inflation is the lowest for a year.

The Retail Prices Index (RPI) also recorded a fall in April; having declined to its first negative reading since 1960 in March (-0.4 per cent), RPI is now -1.2 per cent, the lowest level since the reading began in 1948.

Key to the recent falls in RPI is the slashing of the Bank of England base rate, as mortgage costs are factored into the figure. Downwards effects were also caused by house depreciation, rent and council tax.

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