In the News Teaching Activity – How lower-than-expected inflation affects people (Oct 2024)

September’s CPI inflation rate fell to 1.7% which was lower than many economists had expected – who gains and who loses?

September’s inflation figures are out, and they’ll impact everything from benefits and pensions to mortgages. Benefits like Universal Credit will see a rather modest 1.7% rise next April, meaning small increases for millions, much less than last year’s hike. Meanwhile, pensions will increase more thanks to the "triple lock" with a 4.1% boost, though many pensioners look set to lose the £300 Winter Fuel Payment. The budget looms this week, with potential tax hikes and spending cuts on the horizon. Now inflation is below its target of 2%, we can start to anticipate an interest rate fall, easing mortgages, but squeezing savers.

Why this month's inflation figure matters for you - BBC News

1. What is CPI inflation, and why is it important for the economy?

2. Who benefits and who loses from lower inflation?

3. How does lower inflation relate to fiscal drag, and why could it be a concern?