The UK's rate of inflation fell to 0.3% in April, according to the Office for National Statistics (ONS).
Having risen to a 16-month high of 0.5% in March, it is the first time the consumer prices index has fallen since September 2015 and returns to the same rate seen in February.
The ONS said a range of factors contributed to the fall, including reduced air fares, clothing prices, social housing rent and vehicle costs.
Andy Scott, economist at HiFX, said "weaker than expected inflation figures" are "likely to keep interest rates lower for longer, typically making a currency less attractive. But Sterling was buoyed by two EU referendum polls on Monday that showed a healthy nine point lead for the Remain camp, with the odds of the UK staying now around 70%, according to some bookmakers."
Michael Baxter, an economics blogger, said: "Inflation has been defying predictions all year. In April, month-on-month inflation was a tiny o.1%. The oil price has risen since the period the latest data relates to, and even so, inflation's stubborn refusal to rise to the levels expected is quite shocking. Maybe the underlying cause is a chronic lack of demand worldwide, caused by what Ben Bernanke refers to as a 'global savings glut'. If that is right, then the odds of helicopter money, in which central banks fund a government stimulus, are rising."