Inflation falls in December
Petrol, gas and clothing contribute to fall from November to December.
Inflation fell in December, according to latest figures from the Office of National Statistics.
The Consumer Prices Index (CPI) measure has fallen from 4.8% to 4.2% month-on-month, while the Retail Prices Index (RPI) measure has fallen from 5.2% to 4.8%.
This is the biggest drop in inflaton since April 2009. The CPI is now at its lowest level since June 2011, although it's still well above the Bank of England's 2% target.
Petrol, gas and clothing prices were the main contributors to the drop.
Petrol was down by 1.1p per litre, while gas prices were stable from November to December. Clothing prices fell by 3.1%.
The cost of alcohol and tobacco also fell between November and December, with many supermarkets launching pre-Christmas drinks promotions. The price of New World red and white wines and European red wine has fallen over the past year, but European white wine and cider prices have increased.
Meat, fish, cheese and eggs are now cheaper than they were 12 months ago, but the cost of fruit and vegetables is increasing.
Meanwhile, landline and mobile phone charges and the cost of mobile apps increased between the two months.
Looking ahead, inflation is likely to fall further next month, with the January sales pushing down the cost of clothing, furniture and air travel. However, the effect of the recent round of energy company price cuts isn't likely to be felt until February's figure is released, as most don't come into effect until then.
More: Cheapest ways to borrow this January | How to stand the best chance of getting a mortgage
For the latest news on the stories that affect your money, follow us on Twitter
Most Recent
Comments
-
oldhenry, I would advise you not to buy your cider at "Teasc" anymore, - whatever that is? I believe your pension will increase at whatever rate is the highest, so don't worry! I just wish my income would increase at that rate!
REPORT This comment has been reported. -
So if you do not buy new imported clothes, drink the special offers at Christmas cannot find the reduced petrol but have to fill up on motorways, you are stuffed! The inflation rate is a farce and we all know it. real world inflation is way above what the clowns play with at the ONS. Budget cider at Teasc was £1.39 now £1.69= 21.5% increase. There ar eothers of course but the examples qouted are poor. Gas being stable for a month! yes but people ar epaying the high arte and the government cheated on teh pension increase by moving it to CPI from RPI. Even teh latter is not sound for pensioners. They buy few clothes and DCs but lotos energy and food.
REPORT This comment has been reported. -
Worst calendar-year inflation average rate (5.2%) since 1991, amid the worst slump since the 1930s. What bookies might call a Lose Double.
REPORT This comment has been reported.
Do you want to comment on this article? You need to be signed in for this feature
24 January 2012