What is inflation?
Prices of everyday goods such as groceries are one of the key inputs when calculating inflation.
There are various different baskets that can be analysed for different purposes, but the key one as far as most economists and policymakers are concerned is the Consumer Prices Index (CPI) – unless specified, it’s that figure we’re referring to here when we cite ‘inflation’ figures (like the 3.8% figure from September).
Read more on different inflation measures here: CPI versus RPI inflation.
It is important to remember that inflation measures the rate at which prices are changing. If CPI falls from 3.8% to (say) 3.6%, that doesn’t mean prices have fallen (what’s known as ‘deflation’), but that the pace at which they are increasing has slowed.
The Bank of England, along with most central banks, targets a 2% annual rate of inflation, which is seen as economically healthy. Inflation running significantly above this level makes basic necessities unaffordable for lots of people, while running below this can be bad for economic growth.
What do analysts expect for October UK inflation?
According to its November report, the Monetary Policy Committee (MPC) – the group within the Bank of England responsible for setting interest rates – expects inflation to fall from the September figure of 3.8% thanks to cooling in energy and food price increases as well as the inflationary impacts of the last Autumn Budget having worked their way through the system.
“We estimate UK inflation will slightly improve in October's figures, slowing to 3.6% - a 0.2% improvement on the previous month,” said Grant Slade, UK economist at Morningstar. “The disinflation process remains intact, in our view. A weakening labour market and well-anchored long-term inflation expectations should allow for the impact of prior supply-side shocks to fade progressively over the coming quarters.”
Where did inflation go in 2025?
Inflation jumped 0.9 percentage points between March and April, reaching 3.5% – it was the largest month-on-month increase in inflation since October 2022, at the height of the cost of living crisis.
When is UK inflation data released?
The ONS will release the latest UK inflation figures at 7am tomorrow (19 November). We’ll cover the release live here, and bring you live reaction afterwards.
Good afternoon, and thank you for joining our live coverage of the upcoming UK inflation data release.
This is something of a pivotal release as far as the current inflation cycle is concerned, as the Bank of England’s forecasters expect the previous month to have marked the peak of the inflation cycle.
The headline CPI figure for September was unchanged from August, at 3.8%. If they are to resume their interest rate cutting cycle, policymakers will be looking for tomorrow’s inflation figure to come in below that level and confirm the current hypothesis – even though the number was below where most analysts had expected CPI would be for September.