You are here: Home - Household Bills - News -

Cheaper petrol keeps inflation at near 3-year low

Written by:
UK inflation held steady in September at its lowest level since late 2016.

Figures from the Office for National Statistics (ONS) show consumer price inflation (CPI) was 1.7 per cent last month, unchanged from August.

Cheaper motor fuel and second-hand car prices were offset by more expensive furniture, household appliances, and hotel stays.

The last time inflation was lower was in December 2016.

Ed Monk, associate director for personal investing at Fidelity International, said: “That price rises remained unchanged this month – and some way below wage rises – is good news for UK households, but it’s also a sign that the economy overall is struggling for steam.

“With inflation now apparently lodged below the Bank of England’s target, the next change in interest rates is more likely to be down than up, following the trend already set in Europe and the US.”

Wages continue to outpace inflation, with figures published yesterday showing earnings excluding bonuses grew at an annual pace of 3.8 per cent in the June-to-August period.

September’s inflation figures are particularly significant as they have important implications for pensions.

They are used in the ‘triple lock’ calculation which determines by how much the state pension will increase next April and they are used to set the increase in the lifetime allowance – the maximum which can be held in a pension without a tax charge.

Today’s announcement means state pensioners can expect an inflation-busting increase of around 4 per cent next year, while the lifetime allowance should rise from £1,055m to around £1,075m in April 2020 for defined contribution pensions.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

ISAs: your back-to-basics guide for 2018/19

Here’s everything you need to know to make the most of your unused ISA allowance ahead of the 5 April deadli...

A guide to Sharia savings accounts

A number of Sharia savings products have upped their game in recent months, beating more familiar competitors ...

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

  • RT @DomWrong: UK avoiding a recession but it will be harder to grow if the rest of the global economy slows according to @ArtBLondon on @Yo
  • RT @HendersonRowe: “Brexit aside, the UK will struggle to expand if the rest of the global economy is slowing down. After a strong July and…
  • RT @HendersonRowe: “Brexit aside, the UK will struggle to expand if the rest of the global economy is slowing down. After a strong July and…

Read previous post:
Retirees in line for inflation-busting state pension increase

The state pension is set to rise by 3.9 per cent in April 2020, in line with the increase in...