Inflation falls to 1.6%

THE headline rate of inflation has continued to fall, dropping from 1.7% to 1.6% last month.

It has now declined each month since January and is well below the Bank of England’s 2% target.

The Office for National Statistics (ONS) said the largest contribution came from the falling price of transport, particularly motor fuels, with other smaller downward effects from the clothing and furniture and household goods sectors.

These were partially offset by rising prices linked to restaurants and hotels, and alcohol and tobacco.

The ONS said the Retail Prices Index (RPI) figure – which includes housing costs – grew by 2.5%, down from 2.7% in February.