Yahoo Finance Bread, milk and cereals help drive down UK inflation
UK inflation fell to 3.4% in February — the lowest level for two and a half years — driven by slower food price rises.
The drop was the fastest 12-month fall in inflation since 1978 according to think tank the Resolution Foundation.
Prices for food and non-alcoholic beverages rose by 5% in February 2024, down from 6.9%, the Office for National Statistics (ONS) said. The February figure is the lowest annual rate since January 2022, and down from the high of 19.2% in March 2023.
Inflation, the rate at which prices rise over time, has been gradually falling since it hit 11.1% in October 2022, its highest rate for 40 years. However, a fall in inflation doesn't mean prices are coming down — but that they are rising at a slower pace.
Slowing price rises for gin, whisky and various beers helped bring down the pace of price rises in restaurants and hotels.
Restaurant and hotel price inflation dropped from 7% to 6%. Second hand car prices also slumped by 7.3% over the last year compared with an annual decline of 5.9% in January.
Read more: UK inflation dips ahead of Bank of England interest rate call
“Food prices were the main driver of the fall, with prices almost unchanged this year compared to a large rise last year, while restaurant and cafe prices also slowed,” ONS chief economist, Grant Fitzner, said.
“These falls were only partially offset by prices rises at the pump and a further increase in rental costs,” he added.
Since February last year, the pace of price rises for bread and cereals was 6%, the lowest rate of growth since March 2022.
Meat price increases also slowed down, to 5% compared to 6.6% and fish actually got cheaper as it a registered a negative 0.1% change on the month.
Read more: Air fryers replace hand sanitiser in UK inflation 'shopping basket'
Packets of cakes, and some types of bread such as white sliced loaves also fell between January and February.
Milk, cheese and eggs prices also rose more slowly, as did vegetables.
Bucking the overall trend, inflation for oils and fats rose from 8% in January to 8.3% in February.
Watch: What items in your shopping basket counts for inflation?
Download the Yahoo Finance app, available for Apple and Android.
