The Office of National Statistics (ONS)released figures on Tuesday showing that Consumer Price Inflation (CPI) was unchanged at 2.1 per cent in December, the same figure as in November.

For the third month in a row,inflation has been higher than the Bank of England's target of 2 per cent.

The ONS said that downward pressure on inflation came from housing and household services due to gas and electricity bills increasing less than last year. However tariff increases by energy companies mean that the effect could soon change.

More downward pressure on inflation came from furniture and furnishings as the price of kitchen units fell because of discounts on some lines and smaller price increases.

However there was strong upward pressure on CPI from food, especially vegetables, but also from non-alcoholic beverages, bread and cereals, sugar, jam, confectionary and chocolate.

Clothing and footwear also pushed up the CPI rate, mainly because of greater discounting on clothing in the previous December. The biggest upward effect came from women's dresses.

In addition miscellaneous goods and services also pushed up the CPI a little, this was attributed mainly to an increase in mortgage arrangement fees within financial services, said the ONS.

The ONS also reported that the Retail Price Index dropped to 4 per cent in December, down from 4.3 per cent in November. The drop was attributed to average mortgage interest payments having a smaller increase than in the previous December.

RPIX inflation, which excludes mortgage interest payments dropped slightly from 3.2 per cent in November, to 3.1 per cent in December.