Prices rises slowed in August as the Consumer Prices Index (CPI) measure of inflation dropped to two-point-five per cent, down from two-point-six per cent in July.

The consensus estimate had been for a rise of 2.5%.

The "core" measure of prices, which strips out the more volatile food and energy components, increased at a 2.1% year-on-year clip, also as forecast by economists.

The largest downward pressures behind the change in the CPI rate came from furniture, household equipment & maintenance, housing & household services (particularly domestic gas) and clothing & footwear.

These were partially offset by an upward pressure from transport, particularly motor fuels, according to the Office for National Statistics.

The wider measure of inflation, the Retail Prices Index (RPI), stood at 2.9% in August 2012, down from 3.2% in July (Consensus: 3.1%).

The largest downward pressures came from household goods, clothing & footwear and food.

The only significant upward pressure came from fares & other travel costs.

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