Money (3)

The UK's rate of inflation, as measured by the Consumers Prices Index (CPI) remained negative in October, according to the Office for National Statistics (ONS).

The rate remained at 0.1% from September, providing further evidence of a deflationary period in British prices. The CPI has been floating between -0.1% and 0.1% for several months.

The figure is also likely to add to suggestions that any increase in interest rates will not come until later in 2016. Following expectations of the first quarter of 2016, the Bank of England's latest report left most economists predicting a rise would not come until at least the second quarter, perhaps even later.

The ONS reported that clothing and footwear accounted for the bulk of the upward pressures of inflation. But university tuition fees, alcohol, tobacco all pushed inflation down. Again, the ongoing supermarket price war brought down food prices.

Jeremy Cook, chief economist at the international payments company, World First, said: “While the inflation outlook is weak, prices are expected to run higher through base effects of last year’s oil price fall being no longer part of the inflation calculations.. Indeed this move into deflation is likely to be one of the last few around the zero bound given the declines in crude started last November; the Bank of England is expecting that CPI will rally back to 1% through Q1 2016 as a result of these statistical changes. What is even more critical for the economic and monetary policy outlook is how sustainable these rises will be.”