Inflation drops to lowest level on record


Updated on 24 March 2015 | 5 Comments

Inflation fell to 0% in February.

The Consumer Prices Index (CPI) measurement of annual inflation dropped to 0% in February, according to the Office for National Statistics (ONS).

That's the lowest level on record, having fallen from 0.3% in January.

The ONS picked out falls in price in a range of recreational goods (such as data processing equipment, books, games and toys) as well as food, furniture and furnishings as key factors behind the fall. 

[SPOTLIGHT]With inflation now essentially non-existent, any Bank Base Rate rise in the near future is off the cards. Indeed just last month Mark Carney, the Governor of the Bank of England, said that the banking system could cope with Base Rate being cut even further, although that is unlikely at the moment.

With drops in everyday living costs putting a little bit more money in our pockets, now is a good time to try to pay down any debt you have or build up your savings.

The Bank of England does, however, expect inflation to rise again later on in the year as it heads back towards the Government's target of 2%.

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