Inflation in the United Kingdom - Statistics & Facts

The inflation rate in the United Kingdom reached a 41-year-high of 11.1 percent in October 2022. Rising food and energy costs were responsible for much of this increase, with the inflation rate for housing and energy reaching 26.6 percent this month. In 2023, the UK government expects the annual inflation rate to fall to annual rate of 6.1 percent, indicating that prices should start to fall in the coming months. After several years of relatively low inflation, prices across the world surged in 2022. The global supply chain crisis, a knock-on effect of the COVID-19 pandemic, was one of the main reasons for the rapid onset of high inflation, followed by the Russian invasion of Ukraine, which disrupted the price of essential commodities in the food and energy market.

UK households face severe challenges in 2023

As of March 2023, approximately 93 percent of UK households reported that their cost of living had noticeably increased, when compared to a year earlier. The main reason people gave for their cost of living increase was that their food shop had increased, with the second-most common reason being rising energy bills. Unfortunately for UK households, the situation is likely to deterioate before it improves. At the start of April 2023, energy bills for millions of UK households will once again increase due to the limits that suppliers can charge consumers per unit of energy rising. Although wages have been growing, wage growth has not kept pace with inflation since October 2021, with wages growing by 6.5 percent in January 2023, compared with the CPI inflation rate of 10.1 percent in that month. Due to these factors, UK consumers have taken measures to curb their spending, such as spending less on non-essentials and using less gas and electricity in their homes

Which index is the right one?

In the UK, the three main inflation indices are the Consumer Price Index (CPI) , the Consumer Price Index including owner-occupiers' housing costs (CPIH), and the Retail Price Index (RPI). Although the CPI is the most recognizable of these three figures, the Office of National Statistics (ONS) promote the use of the CPIH as a more reliable indicator, as it includes some housing costs that the CPI does not. The RPI has been used for a longer period of time than the other two measures, but is seen to be outdated and flawed and has not been an official statistic since 2013. In general, the CPI is the most referenced figure despite the introduction of the CPIH and the historical context provided by the RPI. Although no longer classed as a national statistic, the UK government still uses the RPI rate to calculate annual rail fare increases and interest on student loan debt. As the RPI typically overstates inflation the UK government's continued usage of the index is controversial, especially as the CPI rate is used by them more often, such as for calculating pension payments.
This text provides general information. Statista assumes no liability for the information given being complete or correct. Due to varying update cycles, statistics can display more up-to-date data than referenced in the text.
Published by D. Clark, Aug 31, 2023

Key insights

CPI inflation rate
4.6%
CPI inflation rate forecast for 2023
7.5%
Value of one 1960 British pound today
23.2 GBP
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Editor’s Picks Current statistics on this topic

Inflation rate for the Consumer Price Index (CPI) in the United Kingdom in October 2023, by sector

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CPI inflation rate in the UK 2023, by sector

CPI inflation rate for goods and services in the United Kingdom from January 1989 to October 2023

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CPI inflation rate for goods and services in the UK 1989-2023

Consumer price index (CPI) inflation rate excluding food and energy in the United Kingdom from January 1989 to October 2023

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Core inflation rate of the UK 1989-2023

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