Inflation reached just 1.1% in 2006, the lowest figure since 1989 and the third rise of under 2% in a row, the national statistics office CBS said today. The low inflation rate is due to a reduction in local authority taxes and a slowdown in energy price rises, the CBS said.

Nevertheless, the cost of food rose 1.4% last year and clothing was 0.5% more expensive. However the price of televisions and audio equipment fell, the CBS said.