Britain’s inflation rate dropped to 0.2 per cent in August as the Eat Out to Help Out scheme helped push down prices in restaurants and pubs.
It was the largest fall in five years and down from the one per cent rate recorded in July, according to the Office for National Statistics (ONS) Consumer Price Index.
Rishi Sunak’s scheme, which offered consumers 50 per cent off meals at restaurants and pubs from Monday to Wednesday in August, was the biggest contributor to the decline, the figures show.
A cut in VAT from 20 per cent to five per cent also contributed as did falling air fares and fewer clothing prices rises over the period.
Meanwhile, upward pressure on inflation was from games, toys and hobbies, accommodation services, road transport services and second-hand cars.
“The cost of dining out fell significantly in August thanks to the Eat Out to Help Out scheme and VAT cut, leading to one of the largest falls in the annual inflation rate in recent years,” said Jonathan Athow, ONS deputy national statistician for economic statistics.
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“For the first time since records began, air fares fell in August as fewer people travelled abroad on holiday.
“Meanwhile the usual clothing price rises seen at this time of year, as autumn ranges hit the shops, also failed to materialise.”
It is the lowest rate of inflation since December 2015.