LONDON: The United Kingdom’s annual CPI (consumer price inflation) hit the lowest level since 1989.
According to official figures, annual CPI fell to 0.3 percent in January as expected in a Reuters poll, from 0.5 percent in December. The tumble largely reflected a slide in oil prices, which last month hit a near six-year low below $45 a barrel, as well as lower food costs.
Finance minister George Osborne welcomed the figures, published less than three months before the election, as boosting households’ spending power after years of weak wage growth.
Economists expect data on Wednesday to show wages rose 1.8 percent in the three months to December, which would be the fourth straight month of above-inflation increases.
Britain’s Office for National Statistics said CPI models for periods before official estimates were produced showed inflation was last lower in 1960.
Easing inflation could delay a first Bank of England interest rate rise since the financial crisis, though for that to happen the price falls would have to spread beyond food and energy and show signs of becoming self-reinforcing.
