UK inflation has fallen for a second month in a row but remains close to a 40-year high, according to new data published by the Office for National Statistics (ONS) today.
Inflation, which measures the rate at which prices rise, fell to 10.5% in the year to December, compared to 10.7% in November.
The drop was due to fuel prices falling along with clothing and footwear prices, however, this was offset by rising costs in restaurants and hotels.
The price of food and non-alcoholic beverages is now rising at a rate of 16.9%, the fastest pace since September 1977.
And prices in restaurants and hotels generally are up 11.4%, the biggest jump since 1991.
However, some analysts believe that the cost of living may now slowly be beginning to ease.
Pay rising at record pace
Meanwhile, separate data shows that wages have grown at the fastest rate in more than 20 years, but are still failing to keep up with rising prices.
Average pay, including and excluding bonuses, rose by 6.4% between September and November compared with the same period in 2021, official figures show.
It is the fastest growth since 2001, excluding during the height of CV19, but when adjusted for rising prices, wages fell in real terms by 2.6%.
Pay packets failing to keep pace with the rising cost of living has led to thousands of workers in both sectors striking over pay and working conditions in recent months.
Strikes have disrupted everything from train services to postal deliveries and hospital care, and more industrial action is set to take place in the coming weeks.
In total, 467,000 working days lost were lost due to strikes in November 2022 - the highest number in more than 10 years.
FTSE 100
The UK's top share index, the FTSE 100, was up one-point at 7,852 shortly after opening this morning, following yesterday's nine-point drop.
Brent crude futures were up 0.93% at $86.72 a barrel.
Companies reporting today
- Antofagasta - Q4 operation review
- BHP Group - Q2 production review
- Burberry Group - Q3 trading statement
- Currys - trading statement
- Diploma - Q1 trading statement