Inflation fell for a second month in a row in December, the latest figures show.
The rate of Consumer Prices Index fell to 10.5 per cent from 10.7 percent in November according to the office for National Statistics.
Inflation was at a 41-year-high in October with prices having risen by 11.1 per cent over the period of a year.
Falling fuel costs were largely behind the slowdown in the pace of price rises, with average petrol price down by 8.3 pence per litre month-on-month in December.
Jeremy Hunt said he wants to half inflation this year
The Government has made tackling inflation its priority for 2023, vowing to stabilise prices and bring the rate back down to a more normal level.
Reacting, Chancellor of the Exchequer Jeremy Hunt said: "While any fall in inflation is welcome, we have a plan to go further and halve inflation this year, reduce debt and grow the economy - but it is vital that we take the difficult decisions needed and see the plan through."
The high level of inflation has led to a number of public sector pay disputes with unions demanding bumper pay rises to cancel out the rise in prices.
However, ministers have warned that such increases would prolong how long it takes for inflation to drop.
Speaking to GB News this morning, immigration minister Robert Jenrick said: "The worst response that we as the government could make to that is to increase public sector pay significantly and therefore lock that inflation in for longer than is necessary and get into a kind of homegrown domestic spiral of inflation.
Robert Jenrick said real terms pay rises would be the 'worst response' to today's figures
GB NEWS
"We should be responding to the first tentative signs of falling inflation internationally by redoubling our efforts not to make the issue worse domestically."
He added: "We've got to be very careful to ensure that we're treating it sensibly, not leading to further rises in inflation and thinking about affordability for the wider taxpayer."
Shadow chancellor Rachel Reeves blamed the government for the high inflation claiming "13 years of wasted opportunities under the Tories have left our economy weak and families worse off".
"We do not have to continue on this path of managed decline," she said.
"Labour will stabilise our economy and get it growing."
