The CPI grew by 2% in the year to December, down from 2.1% in November, due mainly to contributions from the food and non-alcoholic beverages sector and recreational goods and services. Inflationary increases in motor fuels partly offset the downward pressures. Price increases for gas and electricity over the year were slightly more than last year resulting in an upward contribution to inflation. The Bank of England had set a target of 2% for inflation for stability. It is the first time that the CPI has been at 2% since November 2009 (1.9%).
The three main contributors to inflation in recent years have been food and non-alcoholic beverages, housing, water, electricity, gas and other fuels and transport (incl. other fuels). These sectors combined have accounted for more than half of the inflation rate for each month.
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