The UK’s inflation rate decreased to 3.6% overall in the year to October, according to the latest figures from the Office for National Statistics (ONS).
The deceleration in consumer costs aligns with a decision earlier this month by Bank of England to hold the UK’s base interest rate at 4%.
The Consumer Prices Index (CPI, showing prices paid for a basket of certain goods and services, rose by 3.6% in the 12 months to October 2025, down from 3.8% in September.
On a monthly basis CPI rose by 0.4% in October 2025, compared with a rise of 0.6% in October 2024.
Food and beverages were the main upward pressure on CPI
Housing and household services made the largest downward contribution to the monthly change in both CPIH and CPI annual rates.
Food and non-alcoholic beverages made the largest offsetting upward contribution.
ONS chief economist Grant Fitzner said: “Inflation eased in October, driven mainly by gas and electricity prices, which increased less than this time last year following changes in the Ofgem energy price cap. The costs of hotels was also a downward driver, with prices falling this month.
“These were only partially offset by rising food prices, following the dip seen in September.
“The annual cost of raw materials for businesses continued to increase, while factory gate prices also rose.”
BoE held base at 4%
Today’s CPI figure follows a decision earlier this month by the Bank of England Monetary Policy Committee to hold the UK base rate at 4%. The nine-member MPC voted five to four on this.
Andrew Bailey, governor of the Bank of England, said on the day: “We held interest rates at 4% today. We still think rates are on a gradual path downwards, but we need to be sure that inflation is on track to return to our 2% target before we cut them again.”
