UK inflation: Prices drop 0.1% as pressure mounts on Bank of England's Mark Carney

The cost of goods in the UK has dropped by 0.1% in the year to September, putting further pressure on Bank of England governor Mark Carney to push prices up. The central bank chief has a target rate of 2%, but Consumer Price Index (CPI) inflation has been around 0% for most of 2015.

The Office for National Statistics (ONS), which released the figures on 13 October, revealed that food and motor fuel prices were behind the deflationary dip in the year to September as the former fell by 2.5% and later dropped 14.9%.

"The rate of consumer price inflation has now been zero, or close enough to make no difference, since February. It's expected to climb in the coming months as the big drop in fuel prices falls out of the year-on-year calculation, but core inflation, which strips out volatile components like food and energy, also remains weak at 1.0%," said Ben Brettell, senior economist at Hargreaves Lansdown.

"This offers little suggestion that underlying inflationary pressures are building in the UK economy, despite continuing strength in wage growth. Figures due out tomorrow are expected to show pay growing at 3.1%."

He added: "Downside risks to the UK economy are still numerous. Global concerns, especially surrounding China and other emerging markets, have been well-documented, but there are also signs the domestic economy could be faltering.

"Last week's PMI survey for the services sector, which accounts for around three-quarters of economic output, showed business activity growing at its slowest pace for more than two years."

The ONS also explained the decline in prices meanr that a basket of goods that cost £100 ($152) in September 2014 would have cost £99.90 in September this year. The data means that inflation fell further than economists predicted, who estimated a 0.0% rate, ahead of the release.