PRICE IS RIGHTER

INFLATION has fallen further – but experts warn it could be a blip.

The Consumer Prices Index, the Government’s preferred way of measuring rising living costs, slowed to 2.4 per cent last month. It means more workers are finally seeing their wages rise faster than inflation.

But economists say the weak pound and a jump in oil prices could drive inflation back up.

Andrew Sentance, senior economic adviser at accountants PwC, said: “The most likely scenario appears to be that UK inflation will remain stuck around 2.5 per cent over the summer and could pick up in the next couple of months.” Slowing inflation also makes it less likely the Bank of England will raise the base rate soon – which is good for borrowers but bad for savers.

Jacob Deppe, of online trading platform Infinox, said: “With inflation falling yet again and the economy in a near-catatonic state, the odds of a rate rise in 2018 have lengthened significantly. Short of an economic miracle in the second half of the year, the chances of a rate rise before 2019 are remote at best.”

TUC General Secretary Frances O’Grady said: “With the worst pay squeeze for two centuries, what people really need is higher wages, not higher interest rates.” CATHEDRAL City owners Dairy Crest are to tap investors for £70million to expand their cheese-making operation. The cash will be used to ramp up production from 54,000 tons per year to 77,000 tons, to meet soaring demand. The money will go towards increasing capacity at their factory in Davidstow, Cornwall. The news came as Dairy Crest reported annual profits had jumped from £40.3million to £179.2million.