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The official rate of inflation fell last month to 2.2 per cent, its lowest level since January last year.
However, prices are still rising more quickly than most economists had been expecting at this stage of the recession.
City experts had forecast that the Consumer Prices Index would drop from 2.3 per cent in April to about two per cent last month.
They said that the fall in the value of sterling against Britain's main trading currencies, the euro and dollar, had forced up some high street prices, while the recent spike in the oil price has also acted as a brake on the fall in inflation.
The Retail Prices Index, which includes housing costs such as mortgage bills, stood at minus 1.1 per cent, up slightly from minus 1.2 per cent in April. It was the third month running that the RPI was negative.
Jonathan Loynes, UK economist at analysts Capital Economics, said today's surprising figure made it less likely that Britain faced a sustained period of deflation, or falling prices.
The CPI measure of inflation is now expected to trough at about one per cent in the autumn, but only rise slowing during the winter.
Reader views (1)
If prices on the high street (and the bills that land regularly on my doormat) are on the up, why do we bother to measure inflation using a mixture of irrelevant indices and statistics?
We all know that prices are going up, tax is going up and pay is going down. It's time that the government's slavish adoption to measuring and controlling inflation is exposed as one of the causes of the economic mire that we are in.
Hopefully a future government will worry about more meaningful measures.
- Nobby Clark, Perth, the Scottish one
