Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, what assessment his Department has made of the effect of negative inflation on the economy.

Annual inflation has fallen to record lows driven predominantly by falls in food, energy and petrol prices. This temporary period of falling prices is boosting real wages and supporting household spending and economic growth in the short term. But the government is vigilant to the risk of a period of sustained price declines. The government remains committed to the symmetric 2 per cent inflation target and welcomes the Bank of England’s forecast for inflation to return to target in a timely fashion.