Inflation remains at three-year low: ONS

CPI fell from 1.7% in September to the lowest level seen since November 2016.

CPIH inflation, The ONS' headline measure which includes owner occupiers’ housing costs, was also 1.5% in November, unchanged from October.

The largest contribution to the CPIH 12-month inflation rate came from housing, water, electricity, gas and other fuels, offset by downward contributions from accommodation services and tobacco.

Hinesh Patel, portfolio manager at Quilter Investors, commented: “It is not surprising to see inflation stubbornly refusing to budge from its current position, well below the Bank of England’s 2% target. Our models show that inflation peaked in March of this year and we fully expect it to decelerate a little further in 2020. The recent surge in sterling, despite the paring back following Boris Johnson’s commitment to leave the EU by the end of next year, alongside an anticipated and aggressive discounting environment in retail will keep a firm lid on goods inflation.

“Meanwhile, forward looking employment indicators have been soft at best, meaning the service sector should also see a period of low inflation. All of this sets up for a less hawkish Bank of England meeting tomorrow where rate changes will be kept on ice for when we see the true impacts of any Brexit deal feed its way into the economy.”