The Office for National Statistics (ONS) said annual inflation as measured by the consumer prices index fell to 10.1%, continuing a decline from 10.5% in December and its recent peak of 11.1% in October. City economists had forecast a modest drop to 10.3%.
The fall was driven by a continued drop in petrol and diesel prices for motorists at the start of the year, as well as the price of air and coach travel falling back after a steep rise in December.
Restaurant, cafe and takeaway prices also fell month on month, while the cost of furniture dropped as retailers put on January sales.
The latest figures come as the central bank considers whether further interest rate increases are warranted to tackle inflation, a move that would add to pressure on borrowers after 10 successive rate rises in the past 18 months.
UK inflation remains higher than in the US or the 20 EU countries in the eurozone, and some forecasters have said the UK’s acute worker shortages and other constraints on the economy such as Brexit could add to inflationary pressure. US inflation fell to 6.4% in January, and is estimated at 8.5% in the eurozone.
Read more at The Guardian
