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| UK inflation falls to 2% target rate in December | |
| (35 minutes later) | |
| The UK's inflation rate, as measured by the Consumer Prices Index, fell to 2% in December, down from 2.1% the month before. | The UK's inflation rate, as measured by the Consumer Prices Index, fell to 2% in December, down from 2.1% the month before. |
| It is the first time inflation has been at or below the government-set target of 2% since November 2009. | It is the first time inflation has been at or below the government-set target of 2% since November 2009. |
| The Office for National Statistics said the fall was caused by slower increases in the prices of food. | The Office for National Statistics said the fall was caused by slower increases in the prices of food. |
| Inflation as measured by the Retail Prices Index (RPI) rose to 2.7% from 2.6% in November. | Inflation as measured by the Retail Prices Index (RPI) rose to 2.7% from 2.6% in November. |
| The ONS said the rise in prices of both food and non-alcoholic drinks was the smallest it had been since 2006. | The ONS said the rise in prices of both food and non-alcoholic drinks was the smallest it had been since 2006. |
| Phil Gooding from the ONS told the BBC that a slowdown in the increase of fruit and meat prices was behind the fall in the inflation rate. | Phil Gooding from the ONS told the BBC that a slowdown in the increase of fruit and meat prices was behind the fall in the inflation rate. |
| However, rising petrol prices had an upward effect on inflation, the ONS said. | |
| The ONS figures were published the day before supermarket chains Tesco and Asda plan to reduce their petrol and diesel prices by up to 2p a litre. | |
| Asda said from Wednesday motorists would pay no more than 126.7p a litre for petrol and 133.7p a litre for diesel, its lowest price for diesel since July 2012. | |
| 'Welcome relief' | 'Welcome relief' |
| The return to the 2% inflation target was welcomed by Prime Minister David Cameron. | The return to the 2% inflation target was welcomed by Prime Minister David Cameron. |
| "It's welcome news that inflation is down and on target. As the economy grows and jobs are created this means more security for hard-working people," he said. | "It's welcome news that inflation is down and on target. As the economy grows and jobs are created this means more security for hard-working people," he said. |
| Economists said the fall would ease pressure on the Bank of England to raise interest rates following the recent recovery in the economy. | Economists said the fall would ease pressure on the Bank of England to raise interest rates following the recent recovery in the economy. |
| Jeremy Cook, chief economist at currency exchange specialists, World First, said: "The lack of inflation will help stay their hand especially if the pace of job creation seen in the second half of last year also slows." | Jeremy Cook, chief economist at currency exchange specialists, World First, said: "The lack of inflation will help stay their hand especially if the pace of job creation seen in the second half of last year also slows." |
| Chris Williamson, chief economist at Markit, said he now expected inflation to stay close to its 2% target for "some time to come". | Chris Williamson, chief economist at Markit, said he now expected inflation to stay close to its 2% target for "some time to come". |
| "The easing in price pressures is a welcome relief to policy makers at the Bank of England and helps keep the spectre of higher interest rates at bay," he added. | "The easing in price pressures is a welcome relief to policy makers at the Bank of England and helps keep the spectre of higher interest rates at bay," he added. |
| Bank of England governor Mark Carney has indicated that the Bank will not raise interest rates until the unemployment rate, currently at 7.4%, falls below 7%. | Bank of England governor Mark Carney has indicated that the Bank will not raise interest rates until the unemployment rate, currently at 7.4%, falls below 7%. |