UK inflation slips to 32-month low

Unexpectedly large drop

UK inflation fell to 1.7% in August, its lowest level since December 2016 and an unexpectedly large drop from July’s 2.1% figure.

Economists expected a smaller fall, to 1.9%, with the drop following four successive months of the consumer price index running, at or slightly above, the Bank of England's 2% target. The main contributors to lower prices were games, toys and hobbies, clothing, and fares for sea travel, according to the Office for National Statistics. However, both the games and clothing categories are volatile, said Andrew Wishart, UK economist at Capital Economics. The latter was likely pulled down by "unusually wet weather [keeping] shoppers away from the high street", he added, while the former is...