Inflation fell to a four-year low of 2.1% in November as the rise in the price of food eased.
The Consumer Prices Index rate (CPI) has not been lower since November 2009, when it stood at 1.9%.
The figure from the Office for National Statistics (ONS) eases pressure on the Bank of England as it brings inflation closer to its 2% target.
One reason behind the decline is that large rises in household energy bills have yet to take effect and any upwards movement is likely to be seen in the CPI data for December.
The price of food was flat in November compared with the month before, while the annual rate of inflation in the sector fell to 3% from 4.3% in October.
But the increase in the cost of living continued to outstrip regular pay rises, with the last published figures showing wage growth at 0.8%.
A separate measure of inflation, the retail prices index (RPI), remained the same at 2.6% while CPIH, a new measure which includes housing costs, fell from 2% to 1.9%.
Samuel Tombs, UK economist at Capital Economics, said CPI looked set to dip below the 2% target next year.
He said: “As a result, even if earnings growth recovers only marginally next year, an end to the squeeze on real earnings is finally in sight.”
A Treasury spokesman said: “Inflation has fallen to its lowest level in four years. All parts of the economy are growing, the deficit is falling and jobs are being created.”