The inflation rate in Britain did not rise from last month as petrol prices fell at the quickest rate in three years, giving a renewed boost to consumers before Brexit.
Consumer Prices, as per the CPI (Consumer Price Index) rose at rate of 1.7% annually, matching the rate in August. This was the lowest recorded since August 2016.
Prior to this, the Bank of England had forecasted a inflation would average 1.6% in the final quarter, and this looks to be accurate.
ONS Statistician Mike Hardie said “Motor fuel and second-hand car prices fell, but were offset by price increases for furniture, household appliances and hotel rooms,”
Hardie added “Inflation remained unchanged into September at its lowest rate since late 2016”
Fuel prices fell significantly by 2.1% compared to a year earlier, the biggest drop since August 2016.
Adding to this, the price of motor fuel saw a slight decrease with a 0.7% drop, putting heavy downward pressure on inflation.
The Bank of England have stated that inflation pressures may mean rises to interest rates in the medium/long term, as Brexit still looms.
This monthly figure will decide the annual increase in rates for businesses.
Pensioners will also see an increase by 4% in state pension, more than double the current rate of inflation. The triple lock rule means the payout figure is the highest figure in the CPI index.
Dominic Curran, a property policy advisor at the British Retail Consortium said “the CPI figure means that “retailers will have to cough up an extra £137 million from April. Already, while retail accounts for 5% of the economy, it pays a massive 25% of all business rates.The chancellor must take action on rates in the forthcoming Budget and scrap ‘downwards transition’, which takes £1.3 billion from retailers and uses most of it to subsidise rates in other industries”
The fact that the inflation rate is lower than expected is not of surprise, there is still uncertainty in the British economy as consumers look to hold off purchases still a concrete Brexit plan is formulated.
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