Steady does it - inflation sticks at 2.7%

The UK inflation rate remained unchanged at 2.7% in September.

by Elizabeth Anderson
Last Updated: 15 Oct 2013

Another good month for new Bank of England governor Mark Carney: figures published this morning by the Office for National Statistics show that inflation held steady at 2.7% last month, not far off its 2% target.

The UK's inflation rate, as measured by the consumer prices index (CPI), was 2.8% in July and 2.7% in August. A drop in petrol and diesel prices, but a rise in air fares, caused the figure to remain static at 2.7% in September. Air fares fell 18.7% in the year to September, the ONS said, but this was smaller than the 25.2% decrease seen a year ago and so pushed up the inflation rate.

UK inflation rate over the last 10 years:

 

Source: ONS

However, consumers are still feeling the pinch as wages rose by 1.1% on average over the same period. There are other losers too - September's CPI figure is used to set the rate for some benefits, including the state pension and those for disabled people and carers.

Meanwhile the Retail Prices Index grew by 3.2% in the year ending September 2013, down from 3.3% in August.

The Bank of England has said it will not consider raising interest rates until the unemployment rate falls to 7%.

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