--UK Jan RPIX down 0.7% on mo; up 1.8% on yr
--UK Jan RPI down 0.6% on mo; up 2.7% on yr
--UK Jan RPIY down 0.7% on mo; up 1.5% on yr
--UK Jan RPIX below market expectations
--UK Jan HICP up 0.9% on year
--UK Jan service sector inflation up 2.9% on yr; goods up 0.3%
--UK Jan tax & price index up 2.6% on year
--ONS: UK Jan RPIX annual rate lowest since series began in 1976
--ONS: UK Jan RPI annual rate lowest since March 2000
--ONS: UK Jan services inflation annual rate lowest since Nov '96
--Main down effects on UK Jan RPI motoring, housing, home services
--Cheaper petrol cuts 0.18 pct pts from UK Jan RPI annual rate
--Slower house price rises cut 0.07 pct pts from UK Jan RPI
--Cheaper phone calls, fees cut 0.06 pct pts from UK Jan RPI
--UK 2000 HICP 0.8%, lowest in EU for first time on record

By BridgeNews
London--Feb. 13--Cheaper motoring costs and lower household services helped push U.K. underlying inflation down to its lowest level since the series began in 1976, according to figures published Tuesday the Office for National Statistics. RPIX, which excludes mortgage interest payments, fell 0.7% on the month and rose only 1.8% on the year, compared with an annual rate of 2.0% in December and forecasts for another 2.0% rise. Headline RPI fell 0.6% on the month and rose 2.7% on the year, down from 2.9% in December and the lowest since March 2000.
* * * The fall in the RPIX takes the annual rate another step closer to the critical 1.5% level, at which point the Bank of England will be required to write a letter to the Chancellor of the Exchequer explaining why inflation has deviated so far from the 2.5% target. RPIX has now been below target for 22 consecutive months.
RPIY, which excludes mortgage interest payments and indirect taxes, fell 0.7% on the month and rose 1.5% on the year, compared with an annual rate of 1.7% in December.
The EU harmonized measure of inflation, HICP, rose 0.9% on the year, unchanged on the previous month. The average for 2000 was only 0.8%, the best inflation performance in the EU and comfortably below the 2.1% average for all 15 member states. It was the first time the U.K. has been top of its class since comparable records began in 1990.
The downward effect on inflation in January came from motoring costs. Cheaper petrol cut 0.18 percentage points off the annual rate. There was also a smaller downward effect from lower insurance premiums but that was partially offset by higher second-hand car prices.
Slower house price rises in January than at the same time last year helped cut a further 0.07 percentage points off the annual rate. And lower prices for household services, mainly phone costs and some fees and subscriptions, cut 0.06 percentage points off the annual rate. There were also small downward effects from fuel and light costs, catering, and leisure goods.
Seasonal food, an erratic item that often lies behind the inflation swings from month to month, cut the annual rate by 0.03 percentage points in January, reflecting cheaper fresh fish, potatoes and other fresh vegetables. The overall effect was for goods price inflation of 0.3% on the year and services inflation of only 2.9%. The services rate was the lowest since November 1996. That figure in particular will be encouraging for the Bank of England, which has long been concerned about the stubbornness of services inflation. In the opposite direction, the main upward effect came from household goods, where price cuts in the seasonal sales were shallower than at the same time last year. They added 0.07 percentage points to the annual rate. There were smaller upward effects from non-seasonal food costs and personal goods and services. Looking ahead, the ONS noted that historical patterns suggested the possibility of modest upward effects to prices from seasonal food and household goods prices next month. But there was also likely to be offsetting downward pressure from the effect of last year's mortgage increases dropping out of the annual comparison.