Falling petrol prices and a slower rise in the cost of food contributed to a drop in UK consumer price inflation during February.
The rate fell from 3% to 2.7%, the lowest figure since July 2017.
The fall eases pressure on the Bank of England to raise interest rates. There had been speculation it could raise rates at its meeting in May.
The figures suggest the squeeze on households, caused by rising inflation and stagnant wages, may be ending.
The ONS will publish the latest pay growth figures on Wednesday.
Economists expect those figures to show pay growth edged higher, to an annual rate of 2.6% in the three months to January.
And the situation could improve further this year, according to the Bank of England. It expects wages to grow more quickly than inflation.
Phil Gooding, from the Office for National Statistics, said: “Many of the early 2017 price increases due to the previous depreciation of the pound have started to work through the system.
“Hotel prices also fell and the cost of ferry tickets rose more slowly than last year, when prices were collected on Valentine’s Day, when many people could have been taking mini-breaks.
“House price growth remained steady, with prices increasing strongly across much of the country, although London and the north-east are both lagging behind.”
Consumer price inflation hit a six-year high of 3.1% in November and then edged lower to 3%, where it had stayed for the past two months.
Mel Stride, financial secretary to the Treasury, said: “We know families feel the cost of living at the end of every working week.
“We are increasing the National Living Wage which is already helping the lowest earners see their pay rise by almost 7% above inflation.”