Money

Inflation is falling, slowly but surely

Slowly but surely the Consumer Price Index is falling, and inflation is now at the lowest level since 2009. Why does that matter?

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PM: Inflation fall means 'more stability'

Prime Minister David Cameron has welcomed the fall in CPI inflation to 1.5%, tweeting that it means "more stability and financial security for everyone".

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Good news that inflation is at its lowest for 5 years - it means more stability and financial security for everyone. #LongTermEconomicPlan

Read: Inflation falls to 1.5% in May

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Inflation at lowest level since 2009

The fall in the Consumer Prices Index (CPI) measure of inflation to 1.5% marks the lowest in four-and-a-half years.

Falls in the cost of transport services, particularly air fares, were the largest contributor to the fall, the Office for National Statistics has said.

Heavy discounting by supermarkets also provided a large downward effect.

CPI equalled the rate seen in October 2009. It was last lower, at 1.1%, in September 2009.

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Labour: Inflation figures show govt 'complacent'

Labour said the Government is "complacent about the cost-of-living" crisis after inflation rose to 1.8% today which stalled hopes for a pick-up in real terms wages.

These figures underline why this Tory-led government is wrong to be so complacent about the cost-of-living crisis.

Wages after inflation have fallen by an average of £1,600 a year since 2010 and the link between the wealth of the nation and family finances is broken. A huge turnaround is needed to ensure working people aren’t worse off than when David Cameron came to office.

While the Tories try to deny it even exists, Labour has a clear plan to deal with the cost-of-living crisis and earn our way to higher living standards for all, not just a few at the top.

– Catherine McKinnell, Labour’s Shadow Treasury Minister

Read: Inflation rose to 1.8% in April

Cable: 'We need to address zero-hours contracts'

Business Secretary Vince Cable has responded to today's wages and unemployment figures by saying: "Throughout the economic crisis, and now in the recovery, our labour market has shown itself to be resilient and flexible".

UK Business Secretary Vince Cable wants to address zero hour contracts. Credit: Danny Lawson/PA

"People are feeling the benefits of recovery. We now need to focus on increasing job security and confidence.

"This is why I am addressing issues such as zero-hours contracts and restoring the real value of the national minimum wage.

Read: Wage rises beat inflation for first time in six years

"Together with the tax and benefits changes we have made, this will mean more money in people's pockets at the end of each month."

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