Inflation in the UK dipped to 10.7 per cent in November as lower petrol prices helped to ease the rate of price increases from a 41-year high last month.
The dip in the annual inflation rate from 11.1 per cent in October, is one of the first signs that its relentless rise over the past 18 months is coming to an end.
The fall in the rate will not ease the cost of living crisis, however, because the level of prices has not dropped and it reflects some of the increases in prices last year dropping out of the annual calculation.
Even though the inflation rate is still in double digits and far above the Bank of England’s 2 per cent target, the figure might persuade some members of the central bank’s Monetary Policy Committee to believe they have made progress and to vote for a smaller rise in interest rates on Thursday.
Releasing the November figures, the Office for National Statistics said that continued sharp rises in prices in restaurants, pubs, and cafés had offset the downward momentum from petrol prices.
Grant Fitzner, the ONS chief economist, said: “Although still at historically high levels, annual inflation eased slightly in November”.
After the release of the figures, chancellor Jeremy Hunt insisted it was right to take a firm line on public sector pay. In a statement, he said: “I know it is tough for many right now, but it is vital that we take the tough decisions needed to tackle inflation — the number one enemy that makes everyone poorer. If we make the wrong choices now, high prices will persist and prolong the pain for millions”.
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