UK inflation drops to its lowest for nearly three years

UK inflation fell to its lowest level in almost three years after the end of summer sales held clothing prices down.

Annual rate had dipped to 1.7% in August according to the Office for National Statistics, taking inflation down to the lowest level since December 2016.

Marking the drop as the biggest fall in the Consumer Price Index (CPI) measuring of inflation from one month to another in late 2014, economists warned that fears over Brexit and a slowdown in the economy may have discouraged businesses from raising their prices.

Jason Lennard, a Senior Economist at the National Institute of Economic and Social Research, said it seemed that only fewer firms than usual had raised their prices for the time of year.

“Firms are probably waiting to see beyond 31 October before adjusting prices.”