Price rises in the UK slowed for a second month in a row falling to 10.5% in the year to December from 10.7% in November, according to the latest figures from the Office for National Statistics.
Petrol and diesel costs eased last month but food prices continued to soar, reaching the highest since 1977.
Restaurants and hotel prices also jumped in December along with a record rise in air fares.
David Bharier, British Chambers of Commerce Head of Research, said: “A second consecutive easing in the rate of inflation to 10.5%, while minimal, suggests the peak has now passed.
“A further fall in the growth of fuel costs was partially offset by continued increased inflation within the hospitality sector. But this simply means that prices will stabilise at a much higher level than one year ago.
“Inflation is still by far and away the top issue affecting businesses. Our latest research shows that inflation is a concern for 80% of firms, close to the highest on record.
“Small firms continue to face a tidal wave of higher costs from energy, raw materials, interest rates, and higher taxation. Businesses have told us of 600 percent increases in gas and electricity costs. This makes investing for growth impossible.
“The scaling back of Government support on energy costs means that firms will look to the Spring Budget for concrete action to create a much more stable environment to invest, focusing on infrastructure, skills, trade, and green tech.”