UK inflation at 2% target for first time since November 2009!

UK inflation dropped down to its 2% target at the end of 2013, according to the latest official figures. The Office of National Statistics says the consumer prices index rose by 2% in the year to December.

This latest figure is marginally lower than the 2.1% recorded for November 2013.

The fall to 2%, the Bank of England’s target for inflation, also marks the lowest level of inflation seen in the UK since November 2009. The fall in inflation is largely attributed to food prices as well as recreational goods and services, offset by upward contributions from motor fuels. 

IHS Global Insight chief UK and European economist Howard Archer says: “It is possible that consumer prices inflation could periodically dip below 2%. The overall increase in oil and gas prices will now be less than occurred a year ago, due to the government easing some of the green burdens on the ‘big six’ energy companies.”

Inflation as measured by the retail prices index, which is no longer a national statistic, rose to 2.7% from 2.6% in November.