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'.
Prime Minister David Cameron has said that ONS figures showing inflation at 0% is 'good news for family budgets'.
Inflation is running at 0% - the lowest on record. It's good news for family budgets and a sign our long term plan is working.
House prices grew 8.5% in England, 4.9% in Wales, 7.8% in Scotland & 7.3% in N. Ireland in year to January, according to the Office for National Statistics.
Inflation fell to zero last month setting the UK on course for a period of falling prices for the first time in half a century.
The Consumer Price Index (CPI) measure of inflation dropped after recording 0.3% in January, according to the Office for National Statistics. It was a sharper than expected fall and sets a new record low for CPI since comparable records began in 1989. Inflation is expected to dip further in coming months. An experimental model created by the ONS suggests the last time it was negative was in March 1960, at minus 0.6%.
The UK inflation rate fell to 0.3% in January - the lowest annual rate on record, official figures show.
The rate of Retail Price Index inflation also fell to 1.1% from 1.6% the previous month.
The Office for National Statistics said falling prices for food and fuel were the main factors behind the drop.
ITV News Economics Editor Richard Edgar said the 0.9% fall in inflation over the past year is the largest since 2001.
The fall in inflation over the past year - 0.9% - is the largest since 2001
At the sharp end of all the facts and figures from the Bank of England families are scrutinising their shopping baskets, and the businesses plying their trade week in, week out.
ITV News consumer editor Chris Choi reports from Sheffield - were people are just as anxious to know what the future holds for the economy.
George Osborne has said he agrees with Bank of England governor Mark Carney's positive assessment of the state of the country's economy.
The Chancellor took to Twitter to voice his support for "whatever action is needed" to bump inflation back up to target, amid predictions it could drop below zero in the coming months.
Agree with Governor 'economy is growing strongly, unemployment is falling & earnings growth picking up'.Our #longtermeconomicplan is working
Must remain vigilant to upside and downside risks and I welcome that MPC will take whatever action is needed to return inflation to target
Savers and borrowers should be prepared for a rise in interest rates, despite forecasts of a dip in inflation, Bank of England leaders have said.
In response to a question from ITV News economics editor Richard Edgar, the governor said:
Most likely the next move in monetary policy is an increase in interest rates.
We expect these ajustments to be limited and at a gradual pace, but the message is clear - in order to achieve our objective, we are going to look through this one-time adjustment, which is in the end going to be good news for British households.,,, abd ensure that inflation comes back to target in a timely fashion.
But that is consistent with some rate increases over the forecast horizon, in our judgement.