BUSINESS LIVE: Inflation edges down to 6.7%

The ONS revealed at 7am that inflation had fallen to 6.7 per cent in August from 6.8 per cent in July.

A drop in the key core CPI figure from 6.9 percent to 6.2 percent will be considered good news.

This takes some pressure off the Bank of England ahead of tomorrow’s base rate decision. The Bank is still expected to increase the base rate by 0.25 percentage points to 5.5 percent, but this could be its last upward move.

In the data the ONS said:

The largest downward contributions to the monthly change in annual CPI rates came from food, whose prices rose less in August 2023 than a year ago, and accommodation services, where prices can be volatile and fell in August 2023.
The increase in motor fuel prices contributed the most to the increase in the variation in annual rates.
Core CPI (excluding energy, food, alcohol and tobacco) rose 6.2% in the 12 months to August 2023, up from 6.9% in July; The annual rate of the CPI for goods increased slightly from 6.1% to 6.3%, while the annual rate of the CPI for services slowed from 7.4% to 6.8%.