Record oil prices in September failed to push inflation above the Government's 2% target for the third month in succession.

The Office for National Statistics said the Consumer Prices Index (CPI) remained unchanged at 1.8% in September - its lowest rate since March last year.

The CPI was less than the 1.9% forecast by economists as high oil prices had less impact on inflation than expected.

Petrol prices fell by less than a year ago, adding to inflationary pressure, but this was counteracted by lower air and sea fares.

Analysts have said that the figures, which appear to suggest the Bank of England has got inflation under control, may increase speculation of an interest rate cut before the end of the year.

Global Insight's chief UK economist Howard Archer said the CPI figures will make "pleasant reading" for Bank of England policymakers.

But he said oil prices - which have risen to a new record of nearly $87 a barrel - and soaring food bills are likely to add further inflationary pressure in the months ahead.

The Bank is only likely to act if the summer's turmoil in global markets slows the economy, he added.

Mr Archer said: "It is premature to sound the all-clear. We suspect that the Bank will only act before the end of this year if it becomes clear that growth is taking a major hit from the credit crunch."

The lower-than-expected inflation figures came despite a record monthly increase in the price of a pint of milk during September - up 4p on average, - the ONS said.

The biggest downward impact on CPI came from falling gas bills continuing to filter through to households after price cuts among energy firms. This compares with a year ago when fuel bills were rising.

The headline measure of Retail Prices Index inflation - seen as a more representative inflation measure as mortgage costs are included - fell back from 4.1% in August to 3.9% last month.

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