Two months of record inflation figures have now been broken after the ONS revealed this week that CPI annul inflation has fallen back to 4.2% in June. In April and May the figure had held at a record 4.5%.
Falls in recreation and culture prices were the largest downward pressure with a record May to June fall of 0.9%.
In the year to June RPI annual inflation fell from 5.2% in May to 5% this month RPIX annual inflation was also 5% down from 5.3% the month before.
The publication of the figures came on the same day as the latest BRC-KPMG Retail Sales monitor for June. Its figures showed that June sales improved slightly with sales up by 1.5% against a 3.4% increase in June last year.
Food sales slowed but non food rose slightly, partly thanks to earlier than usual clearance Sales. Internet, mail order and phone sales rose 11.5% higher than a year ago compared with a 10.4% rise in May.
Stephen Robertson, Director General, British Retail Consortium, said: "Given June's spate of shop closure announcements and weak company results, these figures are not as bad as they could have been but it shows just how tough times are when total sales growth of 1.5 per cent is regarded as not that bad.”
"Sales continue to be under huge pressure from the squeeze on disposable incomes produced by rising inflation and low wage growth. Underlying conditions are still tough but being masked by a minor revival in non-food sales driven by price cuts and clearance events starting earlier this year,” he said.
Helen Dickinson, Head of Retail, KPMG, agreed: “Across non-food, it was a better month than May. But we are certainly not out of the woods yet.”