In October, inflation reached its highest since May, exceeding the Bank of England’s target rate of 2%.
- Consumer Prices Index (CPI) climbed to 2.3% in October from 1.7% in September, primarily driven by energy costs.
- Rising energy prices, particularly in electricity and gas, significantly contributed to the inflation increase.
- Transport costs continued to decline, slightly offsetting the overall inflation rate.
- Household expenses saw a marked rise, impacting the annual rates of both CPIH and CPI.
New data from the Office for National Statistics (ONS) reveals inflation rose to 2.3% in October, which marks the highest rate since May and surpasses the Bank of England’s target. The noticeable increase from September’s 1.7% is largely attributed to the rising energy prices.
The Consumer Prices Index including owner occupiers’ housing costs (CPIH) saw a significant rise of 3.2% over the past year, compared to 2.6% in September. The primary drivers of this increase are electricity and gas prices, contributing substantially to the inflation change.
Transport costs, however, showed a decline, falling by 2.0% in the year leading to October, contrasting with a 2.4% decline the previous month. On a monthly scale, there was a minimal rise of 0.1%, presenting a slight relief against inflation.
Housing and household services emerged as the most significant contributors to the CPI and CPIH changes, with electricity and gas prices causing upward changes. These were, at least partially, counterbalanced by declining costs in recreation and culture, including live music and theatre tickets.
Grant Fitzner, chief economist at ONS, stated the rise in inflation was notably influenced by the energy price cap’s increase, raising gas and electricity costs. He observed: “These were partially offset by falls in recreation and culture, including live music and theatre ticket prices.”
Inflation continues to rise significantly, primarily driven by increased energy costs, reflecting the broader economic challenges.
