There is good news the UK’s consumer has the inflation rate has fallen to 1.6% – a level not seen since October 2009. This means a £100 bag of shopping bought in March last year would have cost £101.60 in March of this year.
The Coalition Government will be happy to see these figures as they try to combat the cost of living crisis. Recent news that wages are going to increase faster than rents will help support their claims they’re making the average citizen better off.
The decrease in inflation has been caused by the price movement of motor fuels. Last year, over the space of February and March, fuel prices rose by 2.2 pence per litre. This year they stayed level. Along with that diesel fell by 0.4 pence per litre in comparison to a 1.9 pence rise over the same time last year.
There was also some downward pull from clothing and furniture & household goods. While prices all rose over February and March, they increased by less than over the same period last year.
In contrast, the restaurant & hotels and alcohol & tobacco sectors saw their prices rise. Accommodation rose more over the February March period this year than they did in 2013, while spirits also saw alcohol and tobacco rise too.
Graph from Office of National Statistics.
Image from German Federal Archive.