Weather may cloud hopes for inflation

Inflation is a funny beast. It fell a fraction today from 2.6 per cent in July to 2.5 per cent in August but, of course, that means the cost of living is still rising.

Generally the trend of falling inflation is good news and economists expect it to be much closer to the Bank of England’s target of 2 per cent.

However there are some areas of concern which may cause it to defy forecasts and remain stubbornly high.

Principally these involve fuel (petrol has risen sharply in recent weeks) and food.

In this report I visited a farm to look at the pressures on food prices and what they could mean in months to come.