Britain's underlying inflation rate fell back below the government's target in February, easing concerns that interest rates will have to rise sharply to dampen price pressures.
The Office for National Statistics said the targeted measure of inflation, RPIX, which deducts the erratic cost of home loan repayments, slowed to 2.2 per cent in the year to February from 2.6 per cent in January.
The figures are likely to be welcomed by the inflation-wary Bank of England. January's rate was only the second time in 34 months that RPIX had crept above the government's 2.5 per cent target. There were fears that interest rates would have to rise swiftly and sharply from their current 38-year low of 4.0 per cent.
Economists had forecast an RPIX rate of 2.4 per cent for February. They said the latest inflation data endorsed recent comments from Bank of England officials that financial markets had overdone speculation about interest rate hikes.
The all-items RPI inflation rate slipped back to 1.0 per cent in the year to February from 1.3 per cent in the year to January. Again, this was slightly lower than economists' forecasts for a 1.2 per cent rate.
The largest downward effect on the all-items 12-month rate was from changes in prices for clothing and footwear.