THE UK's rate of inflation fell again last month to its lowest level in almost three years, new figures show today.
Consumer Prices Index (CPI) inflation stood at 2.3% in April according to fresh numbers from the Office for National Statistics (ONS).
This is down from 3.2% in March and marks the lowest level since July 2021.
The data shows inflation is now closer to the Bank of England’s 2% target.
Today's figures confirm that inflation is "back to normal" and "brighter days are ahead", Rishi Sunak said.
How to tackle thorny first date subjects… and why you should watch the waiter
The Prime Minister said: "Today marks a major moment for the economy, with inflation back to normal.
"This is proof that the plan is working and that the difficult decisions we have taken are paying off.
"Brighter days are ahead, but only if we stick to the plan to improve economic security and opportunity for everyone."
It comes just a day after the International Monetary Fund (IMF) upgraded the UK's growth forecast for the year, predicting the economy will grow faster than that of any other large European country over the next six years.
Inflation is a measure of how much the prices of everyday goods such as food and clothes, and services such as train tickets and haircuts, have increased compared to a year earlier.
It's important to note that when inflation drops it doesn't mean that prices have stopped rising, it just means they are doing so at a slower pace.
Experts had been predicting a possible drop to 2.1%, so today's announcement is slightly higher.
Reacting to the latest inflation figures, a Treasury spokesperson said: "We rightly protected millions of jobs during Covid and paid half of people’s energy bills after Putin’s invasion of Ukraine sent bills skyrocketing – but it wouldn’t be fair to leave future generations to pick up the tab.
"That’s why we must stick to the plan to get debt falling.
Secret way Tesco staff bag freebies & it’ll have you desperate to work there
"The economy is turning a corner, with strong growth this quarter and inflation close to target, allowing us to cut taxes for the average worker by £900 a year."
Falling inflation offers some hope to mortgage holders and prospective buyers who will be hoping for interest rate cuts.
But pressure is now on the Bank of England to reduce interest rates which are still at a 16-year high of 5.25%.
To do so, it will be looking for signs that services inflation has weakened.
The Bank of England is due to meet again to assess interest rates on June 20.
ONS chief economist Grant Fitzner said: "There was another large fall in annual inflation led by lower electricity and gas prices, due to the reduction in the Ofgem energy price cap.
"Tobacco prices also helped pull down the rate, with no duty changes announced in the budget."
Meanwhile, food price inflation saw further falls over the year, although these were partially offset by a small uptick in petrol prices.
CPI food inflation edged down to 2.9% in April from 4% in March – much lower than its peak of almost 20% in the spring of 2023.
What it means for your money
Cooling inflation is good news for household budgets and for those hoping for a summer mortgage rate cut.
Alice Haine, personal finance analyst at Bestinvest, said: "Easing inflation will be welcomed by households across the nation as incomes can now stretch further than they did a year ago, offering some much-needed respite from the barrage of rising bills of recent times.
"Remember, however, prices are still rising, they are just going up at a much slower pace than they were."
The outlook for household finances "certainly appears rosier" after a challenging few years, Ms Haine added.
She said: "Naturally, an interest rate cut sooner rather than later will deliver further cheer to household budgets particularly for those with multiple debts or large mortgages to service, but a slowing inflation rate does not guarantee an imminent interest rate cut.
"Rate setters analyse a range of data including pay growth, something that has remained stubbornly high in recent months despite easing inflation and a loosening labour market, but the mood music is changing with more hints that a summer rate cut is on the cards."
In anticipation of a possible reduction to the Bank of England base rate, experts have urged mortgage holders to think about their options.
Nicholas Mendes, from John Charcol, said: "As your fixed-rate mortgage period nears its end, start reviewing your options at least 3-6 months in advance. Assess your financial situation, check your credit score, and compare current mortgage rates.
"Consulting a mortgage broker can provide valuable guidance tailored to your specific need such as whether to switch to a new fixed rate, opt for a variable rate, or remortgage with a different lender."
Consumers shouldn't see today's news as a signal to splash the cash, however.
"Even if the hoped-for rate cut does materialise next month, borrowing costs remain high, so those with lingering
financial concerns should remain cautious for now," Ms Haine pointed out.
She explained that reining in expenditure, topping up emergency funds, paying down expensive debts and saving and investing for the future are all sensible approaches to ensure households' finances remain resilient in the long term.
Meanwhile, the UK's rate of unemployment has risen as the number of job vacancies shrinks, according to recent figures.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.
Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories
