UK inflation rises to 2.6% in November

UK inflation has risen to 2.6% in the 12 months to November, according to official figures.

The Office for National Statistics (ONS) said the Consumer Prices Index (CPI) increased from 2.3% in October. The Bank of England’s target is 2%.  

The figures will put further pressure on the government, which has faced challenges in boosting economic growth since coming to power in July.

Chancellor Rachel Reeves acknowledged the ongoing cost of living pressures, saying: “I know families are still struggling… today’s figures are a reminder that for too long the economy has not worked for working people.”

On a monthly basis, CPI rose by 0.1% in November, compared with a fall of 0.2% a year ago, the ONS added. Transport costs were the biggest contributor to the monthly increase.

Core CPI, which excludes energy, food, alcohol and tobacco, rose to 3.5% in the 12 months to November, up from 3.3% the previous month.

Analysts suggest the inflation rise, coupled with recent stronger-than-expected wage growth, makes a further interest rate cut by the Bank of England unlikely. The Bank’s Monetary Policy Committee is due to announce its latest decision on interest rates on Thursday.  

The Bank of England last month cut interest rates by 0.25 percentage points to 4.75%. ¹ This followed a cut in August, the first since early 2020, from a 16-year high of 5.25%.