The retail prices index measure of inflation which includes mortgage interest payments fell to 4.8% from 5.2%.
The drop in the CPI rate was the biggest monthly fall since April 2009 and is the lowest rate since June 2011.
The ONS attributed the drop to lower fuel prices and cheaper clothing.
Cost of food was the largest upward force with food prices rising by 1.4%.
Kevin Mountford, head of banking at Moneysupermarket, said: “The rising cost of living has had a major impact on UK household budgets for the last 12 months and signs that this is beginning to reduce is very welcome indeed.
“However, despite inflation falling month on month, prices are still high. People still need to make sure they're not paying over the odds for major expenses like car and home insurance, energy and other household bills.”
