A surprise fall in inflation in November has given UK consumers an early Christmas present.
Inflation – the rate prices rise at – dropped from 4.6 percent to 3.9 percent last month, which is the lowest for more than two years.
The news has raised hopes that the Bank of England will begin cutting interest rates sooner than expected.
The Office for National Statistics (ONS) said that falling petrol prices were largely behind the drop in inflation.
Slowing prices for food and household goods, including domestic appliances, also contributed.
Commenting on the latest figures, Helen Dickinson, chief executive of the British Retail Consortium (BRC), said: “Inflation continued to fall as fierce competition between retailers helped hold down prices for consumers.
“With the eighth consecutive fall in food inflation and continued easing in clothing and footwear inflation, retailers are clearly working hard to deliver an affordable Christmas for households everywhere.
“Foods that saw falling prices included some dairy products such as eggs and butter, where lower energy prices fed through to supermarket shelves, while the price of bread and cereals and pork also fell. Meanwhile, sugar prices rose substantially due to lower supplies from dry harvests.
“Washing machines and cookers fell in price thanks to extensive Black Friday sales.”
She added: “There are many risks on the horizon for inflation in 2024. In April, retailers face higher business rates – costing retailers hundreds of millions – new EU border checks, and an increase to the National Living Wage.
“To keep inflation falling, it is vital that Government considers the cumulative impact of their policies – from its proposed deposit return scheme to its new packaging Levy – or the rising cost of doing business will undoubtedly filter back through to inflation.”
Inflation – the rate prices rise at – dropped from 4.6 percent to 3.9 percent last month, which is the lowest for more than two years.
The news has raised hopes that the Bank of England will begin cutting interest rates sooner than expected.
The Office for National Statistics (ONS) said that falling petrol prices were largely behind the drop in inflation.
Slowing prices for food and household goods, including domestic appliances, also contributed.
Commenting on the latest figures, Helen Dickinson, chief executive of the British Retail Consortium (BRC), said: “Inflation continued to fall as fierce competition between retailers helped hold down prices for consumers.
“With the eighth consecutive fall in food inflation and continued easing in clothing and footwear inflation, retailers are clearly working hard to deliver an affordable Christmas for households everywhere.
“Foods that saw falling prices included some dairy products such as eggs and butter, where lower energy prices fed through to supermarket shelves, while the price of bread and cereals and pork also fell. Meanwhile, sugar prices rose substantially due to lower supplies from dry harvests.
“Washing machines and cookers fell in price thanks to extensive Black Friday sales.”
She added: “There are many risks on the horizon for inflation in 2024. In April, retailers face higher business rates – costing retailers hundreds of millions – new EU border checks, and an increase to the National Living Wage.
“To keep inflation falling, it is vital that Government considers the cumulative impact of their policies – from its proposed deposit return scheme to its new packaging Levy – or the rising cost of doing business will undoubtedly filter back through to inflation.”
