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CPI continues to slide
by David Campbell on Sep 17, 2013 at 09:40
Consumer Price inflation continued to slide in August with prices rising by 2.7% over the 12 months, down from 2.8% previously and 2.9% in June.
Other than that brief spike the rate of inflation has been broadly stable back since October 2012.
Before a more recent spike in the price of oil to above $110 a barrel, falling transport costs were a significant contribution to the slower rate of increase, alongside clothing.
The fall put the rate of inflation on course for its six-month target of 2%, said Capital Economics.
'We expect both food and core inflation to ease in the coming months,' said its UK economist Samuel Tombs.
'Past movements in commodity prices suggest that food inflation could drop to about 1% within the next six months, while the weakness of leading measures of core price pressures, such as producer output prices, suggest that core inflation has further to fall.'
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