Contractor body backs slip into deflation

The UK’s slip back into deflationary territory is nothing negative for contractors, says the Association of Independent Professionals and the Self-Employed (IPSE).

Responding yesterday to the latest consumer price index, which fell in September to -0.1%, the contracting trade body said it represented “good news” for one-man bands.

“Lower prices keep business costs down at a time when this is a significant concern for many independent professionals,” said IPSE’s economist Lorence Nye.

“Our research has shown freelancers’ daily rate of pay improve in recent months and continued low inflation levels should make them feel better off in real terms.”

Lower fuel prices, which macro economists blamed for the slight deflation, were also something that freelancers would welcome, said Nye, as were lower transport costs more generally.

He reflected: “We remain far from the Bank of England’s target inflation rate of two per cent, so the Monetary Policy Committee should continue to take a cautious approach on the timing of raising interest rates.”