Inflation drops to 2.2pc amid supermarket petrol price war "October's data suggests that the UK economy is hitting a sweet spot," said Martin Beck, an economist at Capital Economics. George Buckley, chief UK economist at Deutsche Bank, said lower levels of inflation were here to stay. "You often see big shifts in CPI reversed the next month," he said. So you may see a 10pc rise in airfares but then the next month a fall of 10pc as these items can be quite volatile. Education is not like that. It moves only twice a year, in September and October. So whatever it does in October, it will not have any consequence to what it does in November.And this means this lower rate of inflation is now embedded. However, the Alliance Trust said that while the headline rate of inflation had fallen sharply, the elderly still faced much sharper price rises because they spend a larger share of their household budgets on energy costs. Inflation for the over 75s was estimated to be 2.5pc in October, according to the Alliance Trust. Gas price inflation is running at 8.3pv and electricity inflation at 8.6pc. The recently announced energy price hikes are due to kick in from November, so inflation rates in these categories may move even higher next month, disproportionately affecting the elderly households," it said yesterday. Kathleen Brooks, research director at Forex.com also noted that wage growth remained "anaemic." RPI measure of inflation, which the ONS no longer classifies as an official statistic, but is still used to uprate index-linked government bonds and rail fares stood at 2.6pc in October, while CPIH, which includes housing costs, eased to 2pc in October, from 2.5pc in September. A spokesman for the Treasury said: "Britain's hard work is paying off and the country is on the path to prosperity. Thanks to the government's long term economic plan, all parts of the economy are growing, the deficit is falling and jobs are being created - and that's the only sustainable way to raise living standards for hardworking families. But times remain tough for many people so wherever possible we have found the money to freeze fuel duty, freeze council tax and take 2.7 million people out of tax by increasing the tax free personal allowance.