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UK inflation fell significantly in October as energy prices and food inflation eased, with headline inflation dropping to 4.7% from 6.3%.

The Consumer Prices Index, which includes owner occupiers’ housing costs rose by 4.7% in the 12 months to October 2023, down from 6.3% in September.

On a monthly basis, CPIH rose by 0.1% in October 2023, compared with a rise of 1.6% in October 2022.

The largest downward contribution to the monthly change in annual rates came from housing and household services, where the annual rate for CPI was the lowest since records began in January 1950.

The second-largest downward contribution to the monthly came from food and non-alcoholic beverages where the annual rate was the lowest since June 2022.

Food price inflation (including non-alcoholic beverages) fell from 12.2% to 10.1% in the month, while alcoholic beverages fell from 11.2% to 11%.

The ONS said that 9 of the 11 food price class saw a downward price movement during the month.

Within milk, cheese and eggs, there were downward effects from three of the six subclasses, notably from yoghurt, with prices in this category falling by 2.9% between September and October this year, compared with a rise of 5.8% between the same two months a year ago.

This has led to the annual rate for milk, cheese and eggs easing to 7.9% in the year to October 2023, down from 12.3% in September.

Within vegetables there were downward effects from three of the six subclasses, notably from crisps, with prices for these products falling by 3.4% between September and October this year, compared with a rise of 4.1% between the same two months a year ago. This has led to the annual rate for vegetables easing to 10.8% in the year to October 2023, down from 14.4% in September.

The remaining two classes were oils and fats, and coffee, tea and cocoa, and they provided no change in contribution to the 12-month rate.

Although the annual rate at which food prices have been increasing has been slowing, the food price index is still at a high level in comparison to recent years, the ONS noted.

The price of food in October 2023 remains around 30% higher than it was in October 2021.

Core CPIH (excluding energy, food, alcohol and tobacco) rose by 5.6% in the 12 months to October 2023, down from 5.9% in September.

Morning update

Reckitt Benckiser has announced that chairman Chris Sinclair will step down from the board following its 2024 AGM.

Sir Jeremy Darroch will succeed him as chair at the conclusion of the Company’s AGM, currently scheduled for May 2024.

Reckitt expressed its “deepest appreciation and gratitude” to Sinclair for his “extraordinary contribution, service and leadership during the past nine years”.

During Chris Sinclair’s tenure as chair, the company said he oversaw significant transformation of Reckitt, including the introduction of its ‘purpose’ - to protect, heal and nurture in the relentless pursuit of a cleaner and healthier world - navigated both challenges and opportunities arising from the Covid pandemic, and has been instrumental in strengthening the governance and oversight of the board.

Darroch joined the board as a non-exec director in November 2022.

He is an “outstanding leader, with considerable expertise in the consumer retail environment built up over a successful career at some of the UK’s most high-profile companies”.

He is currently the chair of the National Oceanography Centre, and is a seasoned non-exec director having held board positions in Marks and Spencer Group and Burberry Group.

Sir Jeremy Darroch said: “I would like to take the opportunity to thank Chris for his service to Reckitt over the last nearly nine years both as Chairman and as a Non-Executive Director. His commitment has been absolute and his counsel to the executive and the Board has been invaluable. I am delighted that I will succeed Chris as Chair.

“Reckitt is a world-class company with an exceptional portfolio of market-leading, high-margin brands. As a Board we are aligned that Reckitt is extremely well positioned to deliver sustainable and sector-leading total returns for shareholders.”

Chris Sinclair said: “Reckitt is a strong, well-invested business that is fully focused on enhancing returns to shareholders. It also has a unique culture that has made my time with the Reckitt team extremely fulfilling and I am delighted to be handing over to Sir Jeremy Darroch who has agreed to be the next Chair of Reckitt.

“Jeremy is an outstanding leader and the ideal appointment for Reckitt. He has considerable expertise in the consumer retail environment from his executive career at Sky, DSG International and at Proctor and Gamble, a passion for responsible and sustainable business and a track record of shareholder value creation.”

On the markets this morning, the FTSE 100 is up 1% to 7,517.1pts on the inflation data.

Risers include THG, up 4.4% to 77.5p, McBride, up 3.7% to 50.8p and SSP Group, up 3.7% to 215p.

Fallers include Ocado, down 1.8% to 554.4p and Naked Wines, down 1.7% to 29.5p.

Yesterday in the City

The FTSE 100 ended the day up 0.2% at 7,440.4pts.

On a strong day for consumer stocks, risers included Ocado, up 10.1% to 564.6p, THG, up 8.8% to 74.2p, Just Eat, up 8.7% to 1,252p, SSP Group, up 6% to 207.4p, Domino’s Pizza Group, up 5.9% to 371p and WH Smith, up 5.7% to 1,318p.

The day’s few fallers included Compass Group, down 2.1% to 2,057p, DS Smith, down 1.4% to 293.2p, Coca-Cola HBC, down 1.3% to 2,065p and Coca-Cola Europacific Partners, down 1.3% to €56.25.