UK inflation unexpectedly drops to three.2% after meals costs fall

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Your help makes all of the distinction. Learn extra UK inflation dropped excess of anticipated final month, with meals costs falling to ease the price of residing for households throughout the nation, new official figures confirmed.

Client Costs Index (CPI) inflation fell to three.2 per cent in November, down from 3.6 per cent in October, the Workplace for Nationwide Statistics (ONS) mentioned - the bottom CPI charge since March this yr and a notably greater drop than the three.5 per cent that the majority economists had been anticipating.

Probably the most rapid knock-on impact of this knowledge, together with the previous week displaying rising unemployment and the economic system contracting by 0.1 per cent, will likely be an almost-certain rates of interest reduce when the Financial institution of England’s MPC voters collect on Thursday.

Whereas the BoE has been reluctant to chop charges too shortly with inflation far above the two per cent goal, the surprising drop in CPI charge will imply a fourth rate of interest reduce of the yr earlier than Christmas.

Whereas inflation has slowed, a 3.2 per cent charge does nonetheless sign a rise - it signifies that costs are nonetheless rising, however at a slower charge than they had been earlier than.

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Meals and drinks, in addition to alcohol and tobacco, had been the most important components pulling on the general charge of inflation final month.

On a month-to-month foundation, meals and non-alcoholic drink costs fell by 0.2% in November, with the most important drops coming from bread and cereals, in addition to declines in dairy, sugar, jam and chocolate.

The annual charge of inflation for the class fell to 4.2% in November, from 4.9% in October.

Alcohol and tobacco inflation noticed a pointy drop to 4% within the yr to November, from 5.9% within the yr to October – marking the bottom charge in almost three years.

The ONS additionally pointed to extra Black Friday discounting on garments and footwear this yr, which helped carry down costs by 0.3% between October and November.

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The largest falls got here from girls’s clothes throughout a variety of things, together with trousers and skirts.

Chancellor Rachel Reeves mentioned reducing family payments was a “prime precedence” after the newest inflation knowledge was launched.

She mentioned: “I do know households throughout Britain who're nervous about payments will welcome this fall in inflation.

“Getting payments down is my prime precedence. That's the reason I froze rail fares and prescription charges and reduce £150 off common power payments on the Finances this yr.

“The Financial institution of England agree it will assist reduce costs and anticipate inflation to fall quicker subsequent yr in consequence.”

ONS chief economist Grant Fitzner mentioned: “Inflation fell notably in November to its lowest annual charge since March.

“Decrease meals costs, which historically rise at the moment of the yr, had been the primary driver of the autumn, with decreases seen, notably for muffins, biscuits and breakfast cereals.

“Tobacco costs additionally helped pull the speed down, with costs easing barely this month after a big rise a yr in the past. The autumn within the worth of girls’s clothes was one other downward driver.

“The rise in the price of items leaving factories slowed, pushed by decrease meals inflation, whereas the annual price of uncooked supplies for companies continued to rise.”

<img src="https://static.independent.co.uk/2025/12/17/10/17095122-5bbae010-72f1-4e1c-b3f4-fdc2106fa1ca.jpg" srcset="https://static.independent.co.uk/2025/12/17/10/17095122-5bbae010-72f1-4e1c-b3f4-fdc2106fa1ca.jpg?quality=75&width=320&auto=webp 320w, https://static.independent.co.uk/2025/12/17/10/17095122-5bbae010-72f1-4e1c-b3f4-fdc2106fa1ca.jpg?quality=75&width=640&auto=webp 640w" loading="lazy" alt="Inflation eased in November for a range of everyday groceries, including breakfast cereals (Nik Taylor/Alamy)" class="sc-1mc30lb-0 ggpMaE inline-gallery-btn"/> open picture in gallery

Inflation eased in November for a variety of on a regular basis groceries, together with breakfast cereals (Nik Taylor/Alamy) (Alamy/PA) Kris Hamer, director of perception on the British Retail Consortium (BRC), mentioned the autumn in inflation was pushed by “in depth discounting by retailers throughout Black Friday month”.

“With many purchasers kicking off their Christmas procuring, there can have been reduction to see the value of clothes and footwear fall on the yr,” he mentioned.

“And whereas excessive labour and commodity prices have pushed up meals inflation over 2025, greater promotions forward of Christmas helped to carry this determine down.

“Because of this, there have been offers available, with greater reductions seen for some meat merchandise comparable to pork, lamb and rooster.”

The ONS’s most popular measure of inflation, Client Costs Index together with occupiers’ housing (CPIH), fell to three.5% in November, from 3.8% in October. In the meantime, the Retail Costs Index (RPI) charge of inflation slowed to three.8% from 4.3% in October.

Hargreaves Lansdown’s head of non-public finance, Sarah Coles, mentioned: “Vitality costs additionally continued to spark decrease inflation, as a decrease power worth cap rise in October than the yr earlier than imply electrical energy costs are up simply 2.8% and gasoline costs 2.1%. The Finances introduced some excellent news for power payments, with the removing of costs which can be anticipated to chop the associated fee by £150 a yr from April. On condition that in any other case the forecast was for an increase within the worth cap in April, this will likely be a reduction for hard-pressed invoice payers.”

Karen Betts, CEO of The Meals and Drink Federation, added: “It is good to see meals inflation beginning to fall, not least as consumers fill their cabinets for the festive season. Nonetheless, meals costs stay larger this Christmas than final and plenty of customers are having to make robust decisions about what they purchase this yr. Producers proceed to work onerous to chop prices and move any potential financial savings on to customers, however themselves proceed to face vital price pressures. To essentially affect this persistent meals inflation, we'd like Authorities to redouble efforts with meals companies to scale back prices, like power, and increase progress and productiveness to carry down costs within the coming weeks and months throughout the foods and drinks provide chain.”