UK inflation eases more than expected in November

(Sharecast News) - UK inflation eased more than expected in November, according to figures released on Wednesday by the Office for National Statistics. Consumer price inflation slowed to 3.9% from 4.6% in October. This marked the lowest reading since September 2021 and was below analysts' expectations of 4.4%.

The ONS said the largest downward contributions came from transport, recreation and culture, and food and non-alcoholic beverages.

Core inflation - which strips out volatile food and energy prices - fell to 5.1% in November from 5.7% the month before. Economists were expecting it to ease to 5.6%.

ONE chief economist Grant Fitzner said: "Inflation eased again to its lowest annual rate for over two years, but prices remain substantially above what they were before the invasion of Ukraine.

"The biggest driver for this month's fall was a decrease in fuel prices after an increase at the same time last year.

"Food prices also pulled down inflation, as they rose much more slowly than this time last year.

"There was also a price drop for a range of household goods and the cost of second-hand cars."

Ashley Webb, UK economist at Capital Economics, said: "Looking ahead, our forecast is that the recent downward trends in CPI and core inflation will stall over the next few months before starting to decline more decisively again in February.

"And the recent string of softer-than-expected wage and inflation data mean the Bank may not wait as long as our forecast of late in 2024 to cut rates."