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UK inflation edges lower

Inflation showed a slight drop last month falling to 2.5% in August, from 2.6% the previous month. The decline came as furniture prices, gas and electricity bills and clothing costs rose by less than a year ago.

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Bank of England hopes inflation will resume downward trend

Inflation has come down a long way since its high point of 5.3% in September last year, but it is still some way off the Bank of England's target of 2%.

Most economists saw July's disappointing figure of 2.6% as a bump in the road, and expect the gradual downward trend to continue.

But higher food and petrol prices could jeopardise that, as could further energy price hikes this autumn. Higher university tuition fees will also add to inflation next month.

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