New figures from the Office for National Statistics shows that manufacturers' costs fell for the first time in around a year in July.

While the price paid for raw materials and fuel remains 30.1% higher than they were in 2007, a drop of 0.6% was recorded between June and July, supporting the view that the worst may be over for the manufacturing sector.

Significantly, the drop in prices occurred at the same time that oil prices across the world hit record highs, suggesting that the situation is likely to further improve now that the recent spikes in the cost of wholesale crude appear to be abating.

"The recent sharp falls in oil, wholesale gas and food prices suggest that price pressure right at the start of the inflation pipeline may be close to a peak," Paul Dales from Capital Economics told the Financial Times.

However, some analysts are not so optimistic, pointing to the fact that manufacturers still face lower-than-usual profit margins, with selling price increases currently slightly lower than the annual rate of output price inflation.

The figures come ahead of Wednesday's publication of the August Inflation Report from the Bank of England.