The rate of Consumer Prices Index (CPI) inflation in the UK fell to 2.8% in May, down from 3% in April according to the Office for National Statistics (ONS). This is its lowest rate since November 2009.
Retail Prices Index (RPI) inflation - which includes mortgage interest payments - fell to 3.1% down from 3.5% in April.
The slowdown in the rise in food and drink prices was partly responsible for the monthly fall. But the main factor was a fall in fuel prices (diesel prices dropped 4.4% between April and May)
Upward pressure on prices was caused by rises in air and seas fares.
Good news
Obviously for savers a fall in inflation is good news, as it means that their deposits are maintaining their buying power. In fact, with the headline rate of inflation falling to 2.8% it means that more savings accounts now provide inflation beating returns.
Here is a list of the 12 instant access savings accounts that now beat inflation as well a swathe of cash ISAs which provide a return of more than 2.8%.
Calculate your personal inflation rate
But remember that the headline rate of inflation is an overall statistical measure. The personal level of inflation each of us experience is dependent on what we spend our money on. So here is a calculator which can help work out your personal inflation rate.
