As national output tumbled last year, deflation loomed threateningly over Britain's debt-laden economy. Indeed, retail prices did fall on an annual basis during most of 2009 as mortgage-interest payments nosedived. The narrower consumer-prices index (cpi), which excludes owner-occupier housing costs and is used for the government's 2% inflation target, rose by just 11% in the 12 months to September, down from 5.2% a year earlier.
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