The cost of living in the UK is still falling for some, according to Government inflation figures announced today.

The Retail Prices Index (RPI), which measures the cost of living over the past year, including mortgage costs, fell from minus 1.1% in May to minus 1.6% in June.

However, only those whose mortgage costs have plummeted over recent months will typically feel the force of deflation. The Office for National Statistics, which publishes inflation figures, points out that excluding mortgage interest costs, the RPI index rose by 1% over the past year.

The Consumer Prices Index (CPI), which measures living costs excluding mortgages, was down from 2.2% in May to 1.8% in June. This is now below the government's target of 2% and indicates the pace of price rises is easing.

With the cost of living falling for some, this is a boost for savers. Savings rates are far lower than a year ago, but deflation can soften this blow.

Even if you’re earning a paltry sum on your cash it could still outstrip the cost of living, so now is a good time to check your savings rate and switch, if necessary.

Further reading/Key links

Top rates to stash your cash: Savings accounts
Get the best homeloan: Cheap mortgage finding