CPI fell to 2.4% in April – lowest level since March 2017

The fall from 2.5% in March was partly blamed on the timing of Easter, which resulted in a seasonal air fares not being included in April this year.

However, the figures did show the effect of the sugar tax, which saw an increase in the price of soft drinks and juices.

The fall in inflation will relieve pressure that the Bank of England was facing to raise interest rates.

Office for National Statistics head of inflation Mike Hardie said: “Inflation continued to slow in April, with air fares making the biggest downward contribution, due to the timing of Easter. This was partially offset by the rise in petrol prices.”

Current petrol prices are at the highest level seen in three and a half years, with the average price of petrol rising to 127.22p a litre and diesel to 129.6p, following a rapid rise in the cost of oil.

According to analysts, this could mean that the fall in inflation is short-lived.

AJ Bell chief investment officer Kevin Doran said: “UK consumers will be glad to see average wage increases starting to outstrip inflation and for the spending power of the pound in their pocket pick up further. Mark Carney and his team on the Monetary Policy Committee will be happy to see inflation continue to fall back towards the 2% target and will reinforce their decision not to increase interest rates in May.

“However, the recent weakness in the pound and the rising oil price are a concern and could quickly reverse the drop in inflation. The jump in the oil price has started to hit petrol pumps, pushing up costs for UK consumers and businesses alike. In addition, the weak pound will be driving up input costs for many UK companies which will ultimately filter through to UK consumers in the coming months.”

Royal London economist Ian Kernohan has said he “expects CPI to fall towards the 2% target by the end of the year”, but also said that the rise in oil prices will “partially offset” this.

“Lower inflation should give a boost to real income growth,” he added.

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