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Producer Price Index 'will give clearer inflation measure'

July's inflation figures - the first guide to how the post-Brexit fall in the pound's value is affecting the cost of living in Britain - were up on the previous month.

There has been an insignificant rise in consumer price inflation, but in order to get a real sense of where prices might be heading, focus should be directed at the Producer Price Index, which tracks what manufacturers pay for materials.

ITV News Economics Editor Noreena Hertz explains:

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Food and non-alcoholic drinks price fall of 3.3%

The latest fall came as food and non-alcoholic beverage prices saw a record year-on-year drop of 3.3%. They have been flat or falling for 10 months - the longest stretch since 2000 - amid the supermarket price war.

Fall of 3.3% on food and non-alcoholic drinks. Credit: PA

Staple products such as milk, cheese, eggs, bread, jam and chocolate were among those putting downward pressure on CPI.

Motor fuels also saw a record decline, at 16.6%. A litre of petrol fell to 107p in February from 108.3p in January, down from 129p in February last year.

CPI was also driven down by some retail prices that saw smaller than usual increases in February after January discounts.

Osborne: Labour's argument has 'literally come to nought'

Chancellor George Osborne has hailed a fall in inflation to 0%, saying it shows Labour's economic argument has "literally come to nought".

Danny Alexander: Earnings are 'pulling ahead of prices'

Chief Secretary to the Treasury Danny Alexander has said that the new ONS figures on the economy show that 'earnings are pulling ahead of prices'.

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