Shoppers enjoy falling food prices

The Consumer Price Index (CPI) measure of inflation was slightly higher than expected in July, edging up from zero in June due to the weaker impact of summer clothing sales compared to last year.

But CPI was held back by the ongoing supermarket price war, with a 2.7 per cent year-on-year fall in the price of food and non-alcoholic beverages.

It was the 13th month in a row of decreases, the longest such stretch in data going back to 1989.

The figures from the Office for National Statistics (ONS) also gave some cheer for rail passengers with Retail Prices Index (RPI) index inflation - a separate measure that includes housing costs - remaining at one per cent.

July’s RPI is used to set annual regulated fare rises and is the lowest RPI figure for this month since 2009.

Richard Campbell, ONS head of CPI, said: “This is the sixth month running that headline inflation has been at or very close to zero.

“While households will have seen individual prices rise and fall, the overall shopping basket bought by the country remains little changed in price compared with a year ago.

“The latest slight increase is mainly due to clothing, with smaller price reductions in this year’s summer sales compared with a year ago.

“Food and motor fuel prices continued to fall and have helped stop a larger rise in the rate of inflation.”