The Office of National statistics (ONS) has announced  a small drop in the rate of inflation from 1.5% in November to the December figure of 1.4%. Comfortably within the Bank of England's target rate of 2% and contrary to most forecasts, that were looking for a hike of around the same amount.

Energy prices were generally higher for this period and may go higher still, thanks to nervousness surrounding the Iranian situation and the vulnerability of oil carrying tankers to possible Iranian aggression. In normal circumstances, there is still a global oil surplus but the could be a small blip for two or three months in oil prices.

However, the general energy rises were more than compensated by the fall in the prices of clothes and services.

The knock on effect here is a growing belief that the Bank of England will consider a lowering of interest rates, possibly this month and that has led to a weaker pound that was basking still in the upliting effect of the General election that removed one less variable from the overall economic landscape.