UK economy poised to welcome deflation for first time since 1960

Falling energy costs and a supermarket price war may force the inflation rate below zero for the first time in more than five decades

Britain could fall into deflation this week for the first time in more than half a century, the result of an escalating supermarket price war and falling energy prices.

Inflation, as measured by the consumer prices index, fell to zero in February for the first time since comparable records began in 1989. Estimates from the Office for National Statistics suggested that it was the lowest reading since 1960.