U.K.'s producer prices index fell to 0.3 percent in November from 0.6 percent, mainly due to a rise in fuel and food prices, a report by the Office for National Statistics said.
The output price index for homes sales of manufactured products rose 3.9 percent in the year to November, compared with a rise of 4.0 percent in the year to October, the report added.
Excluding food and fuel prices, the index rose 3.3 percent in November.
November's producer prices figures suggested that cost pressures in the industrial sector are still pretty strong, Samuel Tobbs, an economist at Capital Economics, said in a note.
While the rise in November is lesser than the previous month, the inflation at this level is still clearly inconsistent with the Monetary Policy Committee's 2 percent inflation target, he added.
Inflation has been a concern in the U.K. for the past several months. The inflation CPI was 3.2 percent in October, remaining above the 2 percent target for the eighth month in a row. The Bank of England (BoE) policy members chose to maintain the base rate at 0.5 percent and not change the size of the asset purchase on Thursday. The last change in the bank rate was in March 2009.
However, Tobbs remains optimistic that the consumer price inflation will fall in the medium term.
While today's figures will do little to dampen concerns about cost pressures in the industrial sector, there are plenty of other reasons to expect consumer price inflation to fall in the medium term, he said.