UK inflation slowed in July due to falls in the price for gas and electricity, official figures out this morning show.
Inflation dropped to 6.8% in the year to July, down from 7.9% in June.
The BBC says the reduction was expected by experts, and there are signs the cost of living could be easing, after figures on Tuesday revealed wages rose 7.8% annually between April and June.
Matthew Corder, deputy director of prices at the Office for National Statistics, said inflation had dipped due to falling energy prices last month.
Chancellor Jeremy Hunt said July's figures showed action the government had taken "is working".
But he warned that, "while price rises are slowing, we're not at the finish line", reiterating the government's plan to halve inflation by the end of this year.
Jeremy Hunt said July's figures showed action the government had taken "is working".
Food prices
Meanwhile, it was confirmed yesterday that prices of food staples such as sunflower oil and milk are finally edging down - even though shopping bills remain high, new data suggests.
Research firm Kantar said shoppers paid on average £1.50 for four pints of milk in July, down from £1.69 in March.
The average cost of a litre of sunflower oil, meanwhile, is now £2.19, which is 22p less than in the spring.
It comes as grocery inflation - the rate at which overall food prices rise - remains high but is starting to ease.
Prices increased by 12.7% on an annual basis in the four weeks to August 6, according to Kantar, which tracks the spending habits of 36,000 UK households.
That is down from 14.9% a month earlier.
Pressures easing
Food prices surged last year, in large part because of the Ukraine war, but there are signs the pressures may be beginning to ease as wholesale prices come down.
The major supermarkets have also begun to cut the price of basics such as eggs, milk and toilet roll as they face pressure to do more to help struggling shoppers.
It follows criticism that they have not passed on falling wholesale prices to customers - claims that they deny.
Fraser McKevitt, head of retail and consumer insight at Kantar, told the BBC that UK grocery prices overall were "still up year-on-year across every supermarket shelf", but that consumers "will have been relieved" to see the cost of some staples fall compared with earlier in the year.
Shoppers also continue to seek ways to cut their grocery bills, he said, such as shopping at discounters Aldi and Lidl or buying cheaper supermarket own-label goods.
Own-label goods
Sales of own-label goods remained popular last month, Kantar found, climbing 9.7% on an annual basis.
In what may be a sign of growing consumer confidence, however, it said sales of more expensive branded groceries also started to pick up.
Separate research from consumer group Which? Has that found the price of some branded goods on supermarket shelves has more than doubled in 12 months.
The consumer champion, which tracked almost 26,000 food products at eight major supermarkets, found that a six-pack of Mr Kipling chocolate slices at Tesco was the branded product that rose the most in price - going from £1.16 on average in 2022 to £2.66 in July 2023.