Official figures show that Britain's annual rate of retail price inflation rate fell 0.4% in March. This meant that it turned negative for the first time in nearly 50 years due to falling mortgage payments.
The Retail Prices Index (RPI) inflation rate, which includes the cost of home loans, sank last month after a flat reading in February, the Office for National Statistics revealed.
The Bank of England has slashed British interest rates six times since October, to the current record low of 0.5%, as it seeks to lift the country out of recession.
Meanwhile, British 12-month consumer price inflation slowed to 2.9% in March owing to sliding domestic gas, housing and transport costs. That was the lowest CPI level since March 2008 and compared with 3.2% in February.
The inflation data were published a day before the British government delivers its annual budget outlining taxation and spending plans for the 2009/2010 financial year.
