December 2014 CPI falls to 0.5%

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  • Author: Statistics Views
  • Date: 13 January 2015
  • Copyright: Image appears courtesy of iStock Photo

The Office for National Statistics has released the December 2014 figures on Consumer Price Inflation.

The Consumer Prices Index (CPI) grew by 0.5% in the year to December 2014, down from 1.0% in November.

The CPI is a measure of consumer price inflation produced to international standards and in line with European regulations. First published in 1997 as the Harmonised Index of Consumer Prices (HICP), the CPI is the inflation measure used in the Government’s target for inflation.

thumbnail image: December 2014 CPI falls to 0.5%

The CPI 12-month rate (the amount prices change over a year) between December 2013 and December 2014 stood at 0.5%. This means that a basket of goods and services that cost £100.00 in December 2013 would have cost £100.50 in December 2014. This is the joint lowest 12-month rate on record. The CPI 12-month rate was previously 0.5% in May 2000.

Over the last five years, the three main contributors to the 12-month inflation rate have been housing, water, electricity, gas & other fuels, transport (including motor fuels), and restaurants & hotels. Combined, these three sectors have, on average, accounted for half of the 12-month inflation rate each month.

In the year to December 2014, food prices fell by 1.9% and prices of motor fuels fell by 10.5%. Historically, these prices have been among the main causes of inflation, though this has changed in the last year. The food and motor fuels product groups in total reduced the CPI 12-month rate by approximately 0.6 percentage points in the year to December 2014.

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