Official figures show that inflation in the UK has fallen to its lowest level since the immediate aftermath of Russia's invasion of Ukraine, which caused energy and food costs to surge.
The Office for National Statistics said Wednesday that the consumer price index dropped to 8.7 per cent in the year to April from 10.1 per cent in March, largely because last year's energy spike in the wake of the invasion dropped out of the annual comparison. The fall took inflation to its lowest level since March 2022, a month after the war began.
Though welcome, the fall wasn't as big as anticipated. The consensus in financial markets was that it would ease back further to 8.3 per cent.
Elevated food prices push inflation
The main reason why inflation is consistently running higher than anticipated is that food prices remain elevated.
"The rate of inflation fell notably as the large energy price rises seen last year were not repeated this April, but was offset partially by increases in the cost of second-hand cars and cigarettes," the statistics agency's chief economist Grant Fitzner said.
"However, prices in general remain substantially higher than they were this time last year, with annual food price inflation near historic highs," he added.
