The Consumer Prices Index (CPI) rose by 10.7% in the 12 months to November 2022, down from 11.1% in October. The October figure was the highest annual CPI inflation rate in the National Statistic series, which began in January 1997.

On a monthly basis, CPI rose by 0.4% in November 2022, compared with a rise of 0.7% in November 2021.

The Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose by 9.3% in the 12 months to November 2022, down from 9.6% in October.

The largest downward contribution to the change in both the CPIH and CPI annual inflation rates between October and November 2022 came from transport, particularly motor fuels, with rising prices in restaurants, cafes and pubs making the largest, partially offsetting, upward contribution.

Myron Jobson, senior personal finance analyst at interactive investor, says: “Britons will hope that the fall marks the start of a downward trajectory for inflation after being battered by a hike in the cost of seemingly all areas of expenditure from the food we put on our tables to how much we spend to heat our homes.

“Shopping for food is taking a bigger bite out of household budgets, with annual food prices jumping by almost 16.5% in a year to November, up slightly from 16.4% in October. Part of what’s fuelling this are price jumps in everyday larder products, such as bread, which makes this type of inflation sticky because consumers are resigned to paying it as they form part of essential expenditure for many. The rise in food inflation was partially offset by a slowing in rise in the cost of fruit.”

Inflation could spike when energy bills rise

While the hope is the inflation rate will continue to wane, Brits are set to be hit by a new wave of inflation in April when the average energy bill will rise by £500 to £3,000 per year on average. A great deal of uncertainty remains over energy prices. The ongoing war in Ukraine also adds to the uncertainty.

Kevin Brown, savings specialist at Scottish Friendly, says: “Inflation has surprised with the latest figures coming in lower than was expected by markets. With the biggest downward pressure motoring fuels and second hand cars, there may be some relief finally for motorists especially as winter bites.

“But the energy crisis clearly isn’t letting up, and inflation is now becoming more clearly driven by this key problem. The energy price guarantee (EPG) in October seems to have staved off worse rises, but this help isn’t going to last much beyond March as the EPG increases, piling on the pressure after a difficult winter.

“It will be interesting to see how the Monetary Policy Committee reacts tomorrow. Rate hikes have been behind the curve for some time, with inflation getting out of hand many months ago now. But whether they continue the path of big hikes or take a pause now that inflation is faltering, remains to be seen.”