INFLATION has eased to its lowest level for 15 months although food prices remain “at very high levels”.
The Office for National Statistics (ONS) said Consumer Prices Index inflation was 7.9% in June, down from 8.7% in May and its lowest rate since March 2022.
Most economists had expected the rate of inflation to drop to 8.2% in June.
The ONS said that a drop in the price of fuel was the biggest driver behind the drop, while food price inflation also fell to 17.3% from 18.7% in May, though still painfully high.
ONS chief economist Grant Fitzner said: “Inflation slowed substantially to its lowest annual rate since March 2022, driven by price drops for motor fuels.
“Meanwhile, core inflation also fell back after hitting a 30-year high in May. Food price inflation eased slightly this month, although it remains at very high levels.
“Although costs facing manufacturers remain elevated, especially for construction materials and food items, the pace of growth has fallen across the last year, with the overall cost of raw materials falling for the first time since late 2020.”
The fall in inflation means that prices are still rising but not at such a rapid pace.
Today's news shows if the government and the Bank of England are prepared to take difficult decisions, we can win the battle against inflation. But prices are still rising too fast, so we need to stick to the plan until the job is done https://t.co/lRlDWJT8hn
— Jeremy Hunt (@Jeremy_Hunt) July 19, 2023
Wednesday’s figures come after inflation proved stubborn in recent months, failing to come down as sharply as hoped.
Reacting to the news Chancellor Jeremy Hunt said the UK Government was not being “complacent” and that the cost of living is still “a huge worry for families and businesses”.
He said: “The best and only way we can ease this pressure and get our economy growing again is by sticking to the plan to halve inflation this year.”
