Inflation fell to 0.4% in February 2021, according to the latest figures from the Office for National Statistics (ONS) – partly due to falling prices for second-hand cars, clothing, toys and games.
The Consumer Prices Index (CPI) measure of inflation is down from 0.7% in January 2021.
Here, Which? reveals why the inflation rate has changed, and where you can find the best savings accounts and cash Isas to beat it.
Why has inflation fallen?
The main factors between February’s inflation fall are price drops for clothing and footwear, which are down 5.6% – the biggest drop this category has seen since November 2009.
It’s thought this is due to the current lockdown, and the fact that clothing prices didn’t follow the usual sales pattern last year due to the impact of coronavirus.
Other factors include lower prices for food and non-alcoholic beverages, games, toys and hobbies, and second-hand cars.
The Bank of England has been tasked with keeping inflation as close to 2% as possible. However, it’s been below this target since August 2019, and has been at 1%…
