Retail Prices Index (RPI) inflation - which includes mortgage interest payments - fell to 5.2% down from 5.4% in October.
The slowdown in the rise in food and non-alcoholic drink prices were partly responsible for the monthly fall.
Other factors were the slower rise in transport, furniture and clothing costs.
Upward pressure on prices was caused by rises in alcohol, tobacco together gas and electricity prices.
It is now felt that inflation has passed its peak and come January - when the VAT rise falls out of the calculation - it should drop rapidly. However the CPI rate still remains well above the Bank of England target of 2%, in fact it is predicted that this target will not be reached until autumn 2012.
No savings accounts available that can beat inflation
Despite the fact that inflation has fallen there are no savings accounts on the market that can provide a tax payer with an inflation beating return. So unfortunately while the fall in inflation is good news for savers, the bad news is that their money on deposit is still losing its spending power.