UK inflation slows more than forecast to record low 0.3%

London

BRITAIN'S inflation rate fell more than economists forecast in January, dropping to a record low as food and fuel prices plunged.

Consumer price growth slowed to 0.3 from 0.5 per cent in December, the lowest since the data series began in 1989, the Office for National Statistics (ONS) said on Tuesday. Based on a statistics office model, it is the weakest since March 1960, when prices fell 0.6 per cent. Economists had forecast a 0.4 per cent rate in January.

The Bank of England (BOE) cut its near-term inflation projections last week to reflect the drop in oil prices, and governor Mark Carney said that the rate could fall below zero in the coming months. The forecasts also show inflation rebounding starting at the end of this year and gradually rising above the bank's 2 per cent goal, setting the stage for an increase in interest rates by th…