Inflation falls to 7.9 per cent in bigger than expected drop

The UK 's rate of inflation fell to 7.9 per cent in the year to June in a bigger drop than expected, new figures reveal today.

The Office for National Statistics said falling fuel costs, the first drop in raw materials prices since 2020 and a reduced rate of food bill rises has helped bring the inflation rate down.

It means the rate of price rises in the UK has slowed more than expected, down from 8.7 per cent in May - although it still remains high.

Inflation has been on a slow downward trend after a peak of 11.1 per cent last year, but remains well above the target of two per cent - pushing up interest rates.

Commenting on the inflation drop, Greater Birmingham Chambers of Commerce policy advisor Cameron Uppal (pictured) said: “It 's reassuring to see that the rate of inflation has fallen to its lowest level in more than a year given the struggles that business and households have faced with spiralling costs over the last 18 months.

“With core inflation also starting to fall, it will be interesting to see how the Bank of England respond in the coming weeks in relation to the extent to which they are likely to raise interest rates.

“Closer to home, the impact of rising prices continues to bite - in our latest Quarterly Business Report, a third of businesses revealed that inflation was more of a concern than three months ago.

“Put simply, the Government cannot afford to rest on its laurels - tackling the ingrained labour market challenges and easing supply chain disruption with our European counterparts will go someway in continuing to drive down the rate of CPI. ”