Inflation lowest since Nov 2009

There is good news for the economy after official figures revealed inflation had fallen to a two-and-a-half-year low. The Consumer Prices Index measure of inflation fell to 2.8% in May, from 3% in April.

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Today's inflation figure follows a sharp drop

If the inflation figure remains unchanged today it would follow a sharp drop in April:

  • In April CPI [Consumer Price Index] fell to 3% from 3.5% in March
  • That's the lowest level since February 2010
  • Inflation has fallen from 5.2% last September
  • Previous falls are due to the reduced impact of the VAT rise in 2011
  • Also falling energy and food prices and bill cuts from utility providers

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