Inflation continues to fall

INFLATION continued to fall last month, dipping a further 0.1% to 2.7%, according to official figures.

The Office for National Statistics said the largest contributions to the fall in the rate came from transport, particularly motor fuels and air transport, and clothing.

These were partially offset by an upward contribution from furniture, household equipment and maintenance.

The ONS said the latest numbers continue the trend of broadly steady inflation seen since spring 2012. It fell 0.1% to 2.8% in July.

Richard Campbell of the ONS said: “The cost of a basket of good last year that was £100 has risen to £102.70, which is at a slightly slower rate than last month.

“Earnings, including bonuses, are only up around 1% so consumers are still feeling squeezed as there is less money in their pockets.”