The Bank of England enjoyed the good drop in inflation reported today as it can expand their scope of focus on supporting growth as the temporary factors they attributed to the inflation surge above 5.0% start to wane.

In December inflation was in line with expectations rising 0.4% on the month following 0.2% gain and easing on the year to 4.2% from 4.8% which is the lowest since June 2011. Core inflation also was in line with estimates at 3.0% down from 3.2%.

Meanwhile, the RPI rose 0.4% on the month following 0.2% gain and a notch above 0.3% expected and on the year eased to 4.8% from 5.2% but also above 4.7% expected. The RPI excluding mortgage payments slowed on the year to 5.0% from 5.3% and also came above the expected 4.9%.