The data show that RPI - the most commonly used measure among pay setters - stood at -1.1% in May 2009 (up 0.1 percentage point from -1.2% in April 2009).

Consumer prices index (CPI) inflation - the Government's preferred measure of inflation - however showed an equivalent decline, falling by 0.1 percentage point to 2.2% (down from 2.3%). It therefore remains for now in line with the Government's symmetrical target for CPI inflation: that it should not move one percentage point above or below the target rate of 2%.

Latest inflation forecast data compiled by Industrial Relations Services (IRS) suggest that RPI will trough during the current quarter (subscription required) before starting a gradual process of recovery which will see it return to positive territory in the first quarter of 2010.

However, the full impact of negative RPI on pay awards has yet to feed through into the monthly IRS analysis of whole economy pay trends, which already finds pay awards at a historic low of 1.5% (subscription required).

The next IRS analysis of whole economy pay trends will show how pay awards are holding up (or, more likely, not) in this context, when it is published to XpertHR's Pay and Benefits homepage on Friday 26 June 2009.