A HIKE in air fares over Christmas led to a modest rise in inflation to 0.2 per cent.
The figures from the Office for National Statistics (ONS) for the year to December compared to 0.1 per cent for the 12 months to November.
It is the first time inflation moved beyond 0.1 per cent since January last year - having spent several months either stagnant or in negative territory.
The increase followed a 46 per cent surge in air fares between November and December - the highest monthly hike since 2002.
Danske Bank's chief economist in Northern Ireland Angela McGowan said: "This alone pushed CPI inflation up by 0.14 percentage points. Air fares are also the main reason why core inflation was much higher than expected."
Core inflation increased to 1.4 per cent year on year in December from 1.2 per cent the previous month.
Ms McGowan said the bank would "probably just ignore today’s higher-than-expected CPI (Consumer Prices Index) core inflation reading".
"Although CPI core inflation has been trending slightly up since June 2015, the Bank of England would like to see solid proof that it is increasing," she added.
Dr Esmond Birnie, chief economist at PwC in the north said he believed price increases "will continue to be subdued throughout 2016".
He said in addition to air fares rising, a slowing in the rate of decline in petrol and diesel prices added to the inflation rate.
"Downward pressure on prices was also evident in the cost of food and drink," he added.
“We can have some confidence that low inflation will continue. This is partly because there seems to be little pressure to raise global oil prices and partly also because of the slowdown in global demand given the deceleration of the Chinese economy."
Meanwhile, Bank of England governor Mark Carney said yesterday, policymakers were in no rush to raise interest rates amid a weakened world economy and slowing UK growth.
He said "now is not yet the time" to hike rates from their historic low of 0.5 per cent following turmoil in financial markets as oil prices have plunged and China's economic slowdown has spooked investors.
