View more on these topics

UK inflation falls to 3.6%

The UK consumer prices index has fallen to 3.6 per cent in January, according to the Office for National Statistics.

The consumer prices index is down 0.6 per cent from 4.2 per cent in December. The retail prices index fell to 3.9 per cent, from 4.8 per cent in December.

The ONS has cited the rise in VAT from 17.5 per cent to 20 per cent in January 2011 as a significant contributor to the fall in both CPI and RPI between December 2011 and January 2012. The increase led to an increase in prices between December 2010 and January 2011. The ONS says there were no such pressures on prices between December 2011 and January 2012.

The ONS says the largest downward pressures on CPI came from fuels & lubricants, products bought in restaurants and cafes, tobacco, vehicle maintainance & repair, the purchasing of new vehicles and alcohol consumption. Annual inflation has now fallen by 1.2 per cent in the past two months.

The largest downward pressures to RPI came from motoring expenditure, alcoholic drinks, food and tobacco. At 3.9 per cent, RPI now stands at its lowest level since February 2010, when it stood at 3.7 per cent.

The Bank of England’s target rate for CPI is 2 per cent. In December 2011, Bank of England executive director and chief economist Spencer Dale said inflation would fall to around 3 per cent as early as March 2012.


News and expert analysis straight to your inbox

Sign up


There is one comment at the moment, we would love to hear your opinion too.

  1. But its not really 3.6%, its just the VAT increase has fallen out of the figures..

Leave a comment


Why register with Money Marketing ?

Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

News & analysis delivered directly to your inbox
Register today to receive our range of news alerts including daily and weekly briefings

Money Marketing Events
Be the first to hear about our industry leading conferences, awards, roundtables and more.

Research and insight
Take part in and see the results of Money Marketing's flagship investigations into industry trends.

Have your say
Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

Register now

Having problems?

Contact us on +44 (0)20 7292 3712

Lines are open Monday to Friday 9:00am -5.00pm