UK inflation falls to 3.6% but food prices rise again

The UK inflation rate fell to 3.6% in the year to October, the lowest rate for four months.

Prices rose more slowly over the year thanks to gas and electricity prices increasing less than they did this time last year, the Office for National Statistics (ONS) said.

The cost of hotels also contributed to the dip in the inflation rate, the ONS said.

But food prices rose after a dip in September.

The fall means prices are rising more slowly than they were and will foster hope that inflation has peaked, helping to pave the way for lower interest rates.

Inflation was last at 3.6% in June. In the months following that it edged up to 3.8%, before the fall in October.

"Inflation eased in October, driven mainly by gas and electricity prices, which increased less than this time last year, following changes in the Ofgem energy price cap," said ONS chief economist Grant Fitzner.

Household energy prices rose in the year to October, but by less than their rise in the twelve months to September.

The ONS said another factor in the dip was the restaurants and hotels division, with room prices falling in October.

The biggest upward pressure on prices came from food and non-alcoholic drinks, the ONS said. The 12-month inflation rate for food was 4.9% in October, up from 4.5% in September.

"The annual cost of raw materials for businesses continued to increase, while factory gate prices also rose," Mr Fitzner added.