The consumer prices index (CPI) measure of inflation dropped to two per cent in December 2013, the Office for National Statistics (ONS) has announced.
This is the first time the CPI rate has been at the Government’s two per cent target since November 2009.
The ONS attributed the fall to slowing price rises for food and non-alcoholic drinks and recreational goods and services.
However, consumers have seen an increase in the cost of petrol and energy, which had a small upward effect on inflation.
John Allan, national chairman of the Federation of Small Businesses, said that falling inflation will help with the cost of doing business.
“Inflation has been edging towards the two per cent level since last summer, which is welcome relief for hard-pressed households and businesses. With the economy now growing, our members will be pleased that pressures on the cost of doing business are easing though some concerns over rising fuel and in particular energy costs remain.”
The chief economist at the British Chambers of Commerce, David Kern, welcomed the “good news” and said that it “should ease the pressure on businesses and consumers.”