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Petrol and travel costs rise, but inflation stays low

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PETROL costs and wider transport prices are rising, but inflation remains under control and far below the 2% target set by the Bank of England.

Consumer price inflation was 0.4% in February, down from 0.7% in January and a bit lower than the City expected.

Some economists and Chancellor Rishi Sunak have lately worried that a sharp rise in inflation would impact government finances by increasing the cost of servicing the UK’s £2.1 trillion debt pile.

Today’s figures should offer some reassurance that this isn’t an immediate problem. Oil has risen lately, a sign that markets expect global economies to sharply grow once lockdown ends.

ONS Deputy National Statistician for Economic Statistics Jonathan Athow said:

“A fall in clothing prices helped to ease inflation in February, traditionally a month where we would see these prices rise, but the impact of the pandemic has disrupted standard seasonal patterns. Elsewhere there were falls in the price of second-hand cars.

”However, prices at the pump rose this month, compared with a fall this time last year.”

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