Britain’s inflation rate eased away from a 41-year high on Wednesday (Dec 14), but the slowdown brings only limited relief to a nation gripped by a deep cost-of-living crisis.

Consumer prices in Britain rose 10.7 per cent in November from a year earlier, bringing the rate of inflation down slightly from 11.1 per cent in October, which was the highest annual rate since 1981, the Office for National Statistics said.

Despite this tentative sign that inflation may have peaked, British households are being squeezed by high energy bills, food costs and mortgage rates, while wage growth is failing to keep up with inflation. Based on data that goes back to the mid-1950s, Britons are facing the sharpest decline in living standards on record over the next two years. That is prompting a growing wave of labour unrest. Railroad and postal workers are on strike Wednesday over demands for higher pay, while nurses are set to walk off the job Thursday.

On a monthly basis, prices rose 0.4 per cent in November, easing the torrid pace of October, when they climbed 2 per cent in a single month because of higher energy costs, despite billions spent by the government to cap household gas and electric bills.

Core inflation, which excludes energy and food prices, slowed to an annual rate of 6.3 per cent, from 6.5 per cent in October. Economists had expected core inflation to hold steady, according to a survey by Bloomberg. A slowdown in transportation prices, particularly for fuel, as well as clothing and recreation services, all contributed to the lower overall inflation rate, while rising prices in restaurants and for groceries partially offset that. Food and drink prices climbed 16.4 per cent in November from a year earlier.

As a whole, Wednesday’s inflation data are “undoubtedly welcome,” Sandra Horsfield, an economist at Investec, wrote in a note. But “at 10.7 per cent consumer price inflation is still running well ahead of average income growth, causing pain that households can readily attest to.

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“There is still a long way to go before the all-clear on inflation can be sounded,” she added. NYTIMES