The annual rate of inflation decreased to 4.8 per cent in August, according to the Central Statistics Office.
The CSO said prices, as measured by the Consumer Price Index, rose by 0.5 per cent in the month compared to 0.7 per cent in August 2007.
It said this resulted in a drop in the annual rate of inflation last month to 4.8 per cent from 5.0 per cent in July.
Business group Ibec welcomed the fall.
"The recent decision by the ECB to hold off on further interest rate increases will help alleviate the CPI rate somewhat in the coming months, while the recent announcements by the energy regulator of significant reductions in the price of both gas and electricity would also help reduce inflationary pressures," said IBEC senior economist Fergal O'Brien.