Official Data: British Annual Inflation Slides to 1.6%

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Britain’s 12-month inflation slid to 1.6 percent in July from 1.9 percent in June, official data showed on Tuesday, easing pressure on the Bank of England to raise rates.

The Consumer Prices Index (CPI) inflation measure headed back towards May’s figure of 1.5 percent, which at the time was the lowest level for four and a half year years.

Analyst expectations had been for a drop in the annual rate to 1.8 percent, according to a survey by Dow Jones Newswires.

“Falls in clothing prices provided the largest contribution to the fall in the rate,” the Office for National Statistics said in a statement.

“Other large downward effects came from the alcohol, financial services and food & non-alcoholic drinks product groups.”

On a month-on-month basis, the CPI fell by 0.3 percent in July from June.

Tuesday’s data “further eases the pressure on the Bank of England to consider near-term interest rate rises”, said ING Bank analyst James Knightley.

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