Inflation reached 3.6 per cent in the year to October, new figures have shown, in the final update Chancellor Rachel Reeves will receive before a critical Budget centred on tackling the cost of living.
The Office for National Statistics (ONS) reported that inflation declined marginally from last month's reading of 3.8 per cent, though the figure still exceeded some economists' forecasts.
Statisticians at the organisation also noted that services inflation dropped slightly to 4.5 per cent, a metric closely watched by Bank of England policymakers.
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Core inflation, which excludes volatile components such as energy and food, increased by 3.4 per cent, as reported by .
"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 Grant Fitzner, chief economist at the ONS.
"The annual cost of raw materials for businesses continued to increase, while factory gate prices also rose."
Fitzner noted that hotel prices contributed to downward pressure on price growth.
The latest figures are unlikely to alleviate concerns at the Treasury ahead of the Budget.
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Reeves has indicated that reducing the cost of living would be a primary focus when she unveils a raft of new tax and spending measures next week.
The objective underpinning her Budget could result in lower borrowing costs for the government, which are presently projected to surpass £110bn this year.
A concerted effort to reduce inflation through measures that either enhance productivity across the 海角视频 economy or - more controversially - suppress demand via additional household taxation could encourage Bank of England policymakers to support further interest rate reductions over the coming year.
Reduced interest rates would lower regular payments to the government's creditors in bond markets, easing pressure on public finances.
George Brown, senior economist at Schroders, suggested that additional rate cuts would depend on Budget decisions to reduce costs.
"Any further rate cuts will largely depend on the contents of the Chancellor's red box," Brown said.
"Wage growth is still well above a target-consistent pace, especially given repeatedly weak productivity. The Bank must tread carefully given the heightened risk that high inflation becomes entrenched."
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The cost of living also emerged as voters' primary concern in the most recent polling published by City AM/Freshwater Strategy.
One way Reeves may lower inflation at the Budget involves removing VAT from energy bills, which Barclays analysts estimated could reduce headline inflation by 0.15 percentage points.
This could carry a price tag of approximately £2.5bn, widening the £20bn fiscal shortfall the Chancellor must address through spending reductions and tax increases. Other proposals, including raising taxes on gambling and alcohol, could contribute to inflationary pressures.
A week ahead of the Budget, Reeves has already intensified efforts to enhance price transparency and to challenge firms for concealing costs from consumers.
She has written to the Competition and Markets Authority (CMA) requesting an investigation into private dentistry charges. The Chancellor highlighted the government's concerns that dental practices have failed to provide clarity on costs and treatment with patients.
Reeves also indicated the government would introduce greater price transparency for petrol and stimulate competition amongst suppliers.
Responding to the fresh inflation figures, Reeves said: "This fall in inflation is good news for households and businesses across the country, but I'm determined to do more to bring prices down.
"That's why at the budget next week I will take the fair choices to deliver on the public's priorities to cut NHS waiting lists, cut national debt and cut the cost of living."
Shadow Chancellor Mel Stride highlighted that inflation had exceeded the Bank of England's two per cent target in each of the past 12 months.
"Labour's last Budget hiked borrowing and taxes, stoking the inflation now hitting families," he said. "If Labour had any backbone, they would adopt our £47bn savings plan and our golden economic rule next week to ease inflationary pressures."