Inflation is expected to show a sharp fall next week in new figures that will indicate a further softening in the cost of living since the Ukraine war triggered a rise in prices.

UK price growth is forecast to come in between 4.7% and 5% for the year to October from 6.7% in September and should fall steadily over the next two years.

The recent inflation cycle peaked at 11.1% in October last year when global gas prices rose sharply in resonse to the war in Ukraine.

Data in the past week showed food price inflation in single digits for the first time in 16 months but it is falling energy prices which are likely to be the main driver behind a decrease.

Goldman Sachs economists expect headline inflation to decline to 4.7% which is below the Band of England’s projection of 4.8%.

Lower inflation will not only improve consumer confidence in the weeks before Christmas but comes at a good time for Jeremy Hunt, the Chancellor, who is due to announce the Autumn Statement on 22 November.

It will also meet Prime Minister Rishi Sunak’s pledge to halve the UK’s inflation rate to just over 5% by the end of this year.

Attention will now focus on reviving the economy after the Office for National Statistics revealed that there was zero growth in the UK in the three months to the end of September.

Tory backbenchers are calling for tax cuts, but Mr Hunt is expected to stick to his view that this will only see the return of inflation.

However, there are now expectations that he may offer greater tax relief measures to stimulate investment and ease bills for businesses and households. There has been talk of changes to inheritance tax and stamp duty which are less inflationary.

The Bank of England, which has a target of 2% inflation, has left interest rates unchanged at 5.25% for the past two meetings.