- The Consumer Price Index fell by 0.1% in the year to September 2015, compared to no change (0.0%) in the year to August 2015
- A smaller than usual rise in clothing prices and falling motor fuel prices were the main contributors to the fall in the index
- Goods inflation in September was -2.4%, while inflation in services was 2.5%
Commenting on the inflation figures for September 2015, published today by the ONS, David Kern, BCC Chief Economist, said:
“Inflation has remained at or around 0.0% for most of this year, and we expect that this will continue over the next few months. Our forecast is that annual CPI inflation will start to creep upwards early in 2016, but will remain below the 2% target well into 2017. The benign outlook for inflation is also reinforced by our Quarterly Economic Survey, which shows that the proportion of manufacturers expecting to raise prices has fallen to a five-year-low.
“Low inflation boosts disposable income and supports living standards, thus helping the economic recovery. However recent trade and manufacturing figures have been disappointing, and ongoing global uncertainties, especially in the emerging markets, reinforce our view that the recovery is fragile, and no risks should be taken. With inflation unlikely to rise in the short term, the MPC should keep rates at the current low level until well into 2016.”