According to the report from the Office for National Statistics (ONS), in September consumer prices rose by 1.7% per year after an increase of 2.2% per annum in August. The latest increase was the weakest since April 2021. Economists expected prices to rise by 1.9%. On a monthly basis, the consumer price index remained unchanged after rising 0.3% in August. Consensus estimates suggested an increase of 0.1%.
The ONS said that the largest downward contribution to the CPI annual rates came from transport, with larger negative contributions from air fares and motor fuels. The largest offsetting upward contribution came from food and non-alcoholic beverages.
Meanwhile, core CPI - which excludes energy, food, alcohol and tobacco - rose by 3.2% per annum (the lowest value since September 2021) after an increase by 3.6% in August. Consensus estimates suggested an increase by 3.4% per annum. The CPI goods annual rate fell from -0.9% to -1.4%, while the CPI services annual rate slowed from 5.6% to 5.2%. Stubborn services price growth has been in focus in recent months.
On a monthly basis, core consumer prices rose by 0.1%, compared with the 0.4% increase in August. Economists had expected an increase of 0.3%. It was the eighth monthly increase in a row, but the weakest growth in this series.
Overall, the latest data has reinforced expectations that the Bank of England will cut interest rates again at its next meeting, which will be held on November 7.