UK consumer price inflation fell in September to its lowest rate in more than three years, data showed on Wednesday, while producer prices also decreased.

The Office for National Statistics reported that annual consumer price index inflation in the UK rose by 1.7% in September, down from 2.2% in August. This was short of the 1.9% rise that had been expected by FXStreet-cited market consensus.

‘The largest downward contribution to the monthly change in both CPIH and CPI annual rates came from transport, with larger negative contributions from air fares and motor fuels; the largest offsetting upward contribution came from food and non-alcoholic beverages,’ the ONS explained.

On a monthly basis, prices were little changed in September, down from a rise of 0.5% in September 2023. Prices rose 0.3% in August, and fell 0.2% in July.

CPI including owner occupiers’ housing costs, or CPIH, rose 2.6% on-year in September, down from 3.1% in August. On a monthly basis, CPIH rose by 0.1% in September, down from 0.5% in September the year before.

Producer prices meanwhile fell 2.3% annually in September, from a revised decrease of 1.0% in August.

On a monthly basis, producer input prices fell by 1.0%, accelerated from a 0.3% fall in August.

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