United Kingdom Inflation October 2022

United Kingdom

United Kingdom: Inflation comes in at highest level in over four decades October

November 16, 2022

Inflation came in at 11.1% in October, up from September’s 10.1% and above market expectations. October's result represented the highest inflation rate since 1981. The reading was driven largely by higher regulated energy prices, as Ofgem’s energy price cap rose by 25% from September to October.

Annual average inflation rose to 8.2% in October (September: 7.6%). Meanwhile, core inflation was stable at 6.5%.

Finally, consumer prices rose 1.97% in October over the previous month, picking up from September's 0.50% rise. October's jump marked the highest reading since April.

On the implications of the reading for monetary policy, analysts at Nomura said:

“The outsized rise in CPI inflation and strong momentum in core prices, alongside evidence […] of a tight labour market, supports our view of the Bank of England making another bold move in December. We are looking for a 75bp hike.”

FocusEconomics Consensus Forecast panelists expect inflation to average 6.6% in 2023, which is unchanged from last month’s forecast, and 2.5% in 2024.


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United Kingdom Inflation Chart

United Kingdom Inflation October 2022

Note: Annual and monthly variation of consumer price index in %.
Source: Office for National Statistics (ONS) and FocusEconomics calculations.

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