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15th November 2023

Sharp drop in inflation

Today’s ONS data reveals a fall in inflation to 4.6%, the lowest inflation has been since November 2021.

Paul Butterworth, CEO at Chambers Wales South East, South West and Mid, said:

“It is encouraging to see such a significant fall in inflation to 4.6%, the lowest level it has been in two years. This means that the government’s pledge to halve inflation by the end of the year has been met but there is still some way to go to reach the long-term target of 2%. Prices for consumers are still high, and a reluctance to spend will continue to impact businesses.

“Despite ongoing challenges, businesses in Wales will welcome today’s news as 62% were concerned about inflation rates in Q3 according to our recent Quarterly Economic Survey. The 54% of Welsh businesses concerned about interest rates will now be hoping that this drop in inflation could lead to a step change in decision-making in the future.

“Firms will now be looking to next week’s Autumn Statement for a clear strategy for long-term growth and actions which will help boost investment.”

Alex Veitch, Director of Policy and Insights at the British Chambers of Commerce said: 

“Today’s news that CPI eased to 4.6% in October, the lowest level in two years, is encouraging. However, the reality for consumers is that prices are still worryingly high. That is dampening spending and hitting the businesses we represent.

“The data shows prices in the production sector continue to fall with input PPI now at –2.6%. That confirms what companies are telling us. Our Quarterly Economic Survey has been showing a fall in the number of firms expecting their prices to rise for the past five quarters.

“Despite that, firms are still struggling to invest, as they face the challenges of high interest rates, skills shortages and difficult trading conditions.

“Next week’s Autumn Statement is an opportunity for the government to outline a clear strategy for growth. We’re calling for action from the Chancellor on planning, the energy grid, full expensing, business rates and occupational health.

“Movement on these crucial issues can provide a springboard for business investment which will be the cornerstone of economic growth.”

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