Elderly homeowners struggling to make ends meet during the current economic climate have been boosted by the news that inflation fell to a 14-month low in January.

The Office for National Statistics has published new figures which show that the Consumer Prices Index (CPI) measure of inflation fell to 3.6 per cent in January, down from 4.2 per cent in the previous month.

The decline was largely attributed to a minimal rise in commodities such as petrol in January compared to the same month last year, while the 2011 rate was also skewed by the 2.5 per cent rise in VAT.

Furthermore, the Retail Prices Index (RPI) inflation, which includes mortgage interest payments, dipped by 0.9 per cent to 3.9 per cent. 

Despite the positive figures, many older people in the UK will still be concerned about the state of their finances as the headline rate of inflation remains well ahead of its two per cent target.

When coupled with the historically-low interest rate of 0.5 per cent, this means many consumers will be struggling to find a savings account which outpaces the rate of inflation.

Jonty Bloom, business correspondent at BBC News, said: "Inflation at 3.6 per cent means that prices are increasing at almost twice the rate that wages are, and at a much faster rate than people, such as pensioners, can hope to earn interest on their savings.

"That means that for millions of people things are still getting tougher every month as their bills keep on rising and their incomes fail to keep pace."