Commenting on data from the Office of National Statistics, that showed the annual rate of CPI inflation falling to 8.7% in April 2023, Kitty Ussher, Chief Economist at the Institute of Directors, said:

“The fall in the headline rate will reassure business leaders who are hoping that we may now be through the worst of the inflationary peak. However, today’s data will still be a worry to policymakers.

“The fall in the headline rate was not as great as most analysts expected. In fact, monthly inflation has risen, from 0.8% in March to 1.2% in April and ‘core’ inflation that excludes volatile items is also up, from 6.2% to 6.8% in the last month. Food price inflation continues to run extraordinarily high, at 19% annually.

“Policymakers will hope that now that the headline rate is back to single digits, expectations of future inflation will now start to fall as well, which then could become self-fulfilling.”