Inflation RISES as cost of living in UK increases amid interest rate fears - what it means for you
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UK inflation has risen for the second month in a row, taking it further above the Bank of England target. Inflation rose to 2.6% in the 12 months to November 2024, up from the 2.3% that was recorded in October. It marks the highest rate of inflation since March this year - and it comes just one day before the Bank of England announces its latest interest rates decision.
The base rate is widely expected to be paused at 4.75% tomorrow, partly due to a jump in wage growth that was confirmed this week. At its highest point, interest rates were at 5.25%. The Bank of England - which has a target of 2% inflation - had previously been raising interest rates to bring down inflation.
The Office for National Statistics (ONS) releases inflation data every month and blamed the latest increase on rising fuel and clothing prices. The rate of CPI inflation for food and non-alcoholic drinks, alcohol and tobacco, clothing and footwear also edged higher last month.
But the ONS said these rises were "partially offset" by the largest fall in air fares since records began. Core inflation - which excludes energy, food, alcohol and tobacco, and is closely watching by the Bank of England - rose from 3.3% to 3.5%. Inflation had been steadily coming down in recent months and fell to 1.7% in September, its lowest level in three years. It started to rise again in October, after energy bills rose due to a change in the Ofgem price cap. Economists had expected inflation to rise again in November.
Grant Fitzner, chief economist at the ONS, said: "Inflation rose again this month as prices of motor fuel and clothing increased this year but fell a year ago. This was partially offset by air fares, which traditionally dip at this time of year, but saw their largest drop in November since records began at the start of the century.".
