UK inflation rate falls to 3.6%

Consumer Prices Index (CPI) inflation in the UK fell to 3.6% last month, according to the Office for National Statistics (ONS), while RPI inflation - including mortgage interest payments - fell to 3.9% from 4.8%. The ONS said inflation fell sharply as the impact of last year's VAT rise was no longer included in the figures. VAT rose from 17.5% to 20% in January 2011. Ian Kernohan, economist at Royal London Asset Management, said: "The sharp fall in the rate of UK CPI inflation in January is not a huge surprise, given that last year's rise in VAT has now dropped out of the annual compa...