UK inflation rate rose to 2.3% in October 2024

The UK inflation rate rose to 2.3% in October 2024, up from 1.7% in September, according to the Office for National Statistics (ONS). This increase surpasses the Bank of England's target of 2%. The primary drivers of the inflation uptick include rising household energy bills and persistent cost pressures in the services sector, where inflation reached 5%​.

Core inflation, which excludes volatile items like energy and food, also increased slightly to 3.3%, reflecting underlying economic pressures. This suggests that while the headline rate remains moderate compared to the peaks of over 11% in late 2022, certain components of inflation remain stubbornly high​.

Analysts predict the Bank of England will likely hold interest rates steady at 5.25% in its upcoming December meeting to assess the inflationary trajectory before considering further hikes​.

The outlook for the coming months indicates inflation may stabilise above the 2% mark, with projections for 2025 suggesting a further slight increase before easing. This underscores the challenge of balancing economic growth with price stability as the UK continues to navigate post-pandemic economic adjustments and geopolitical uncertainties​.

The ONS Summarised:

The Consumer Prices Index including owner occupiers' housing costs (CPIH) rose by 3.2% in the 12 months to October 2024, up from 2.6% in September.

On a monthly basis, CPIH rose by 0.6% in October 2024, up from 0.1% in October 2023.

The Consumer Prices Index (CPI) rose by 2.3% in the 12 months to October 2024, up from 1.7% in September.

On a monthly basis, CPI rose by 0.6% in October 2024, up from being little changed in October 2023.

The largest upward contribution to the monthly change in both CPIH and CPI annual rates came from housing and household services, mainly because of electricity and gas prices; the largest offsetting downward contribution came from recreation and culture.

Core CPIH (excluding energy, food, alcohol and tobacco) rose by 4.1% in the 12 months to October 2024, up from 4.0% in September; the CPIH goods annual rate rose from negative 1.4% to negative 0.3%, while the CPIH services annual rate was unchanged at 5.6%.

Core CPI (excluding energy, food, alcohol and tobacco) rose by 3.3% in the 12 months to October 2024, up from 3.2% in September; the CPI goods annual rate rose from negative 1.4% to negative 0.3%, while the CPI services annual rate rose from 4.9% to 5.0%.

Source: ONS, House of Commons Library