The Consumer Prices Index (CPI) rose by 2.6% in the 12 months to November 2024, up from 2.3% in the 12 months to October.
On a monthly basis, the CPI rose by 0.1% in November 2024, compared with a fall of 0.2% in November 2023.
The CPI including owner-occupiers’ housing costs (CPIH) rose by 3.5% in the 12 months to November 2024, up from 3.2% in the 12 months to October.
Transport helped drive inflation up. The oil price fluctuated throughout the month, partly due to geopolitical tensions, but also as a result of the market digesting the likely impact of a Trump presidency on supply and demand.
During the month, the average price of petrol rose by 0.8 pence per litre (ppl) and the average diesel price was up 1.4ppl. It’s still far lower than a year earlier, with petrol down 10.7% and diesel down 11.6%. However, the annual drop is smaller than before, which is why it helped push inflation up.
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Food and drink price inflation rose to 2%. Poor harvests in a number of areas have pushed up prices of certain products, including olive oil, which is up 26.6% in a year, while chocolate is up 9.9%. At the moment, this is offset by price falls elsewhere – with annual drops in the price of everything from rice and pasta to pizza and poultry.
Base rate cut ‘unlikely’
Experts have warned that the uptick in inflation makes a cut in the Bank of England base rate this month unlikely. The next Monetary Policy Committee (MPC) announcement is due tomorrow (19 December).
Alastair Douglas, CEO of TotallyMoney, said: “Above-target inflation doesn’t seem to be going anywhere for now, and expectations are that the cost of living could keep rising well into the new year.
“And although yesterday’s figures show that wages are going up, and hopefully helping people cope, the truth is that it’s mostly skilled workers reaping the rewards. The big worry is for those on inflation-linked benefits and tax credits, because they’ll see an increase of just 1.7% from April, meaning the gap will continue to grow.
“This all makes a possible rate cut at tomorrow’s Monetary Policy Committee meeting even more unlikely, as it’s clear the country is still struggling to control inflation. Long gone are the days when the former Prime Minister and the Bank of England were celebrating their hold on the cost of living before Christmas, and instead there’s the odd grumble and pointed finger.”
Daniel Casali, chief investment strategist at Evelyn Partners, said: “The uptick in annual and core inflation from the previous month makes it unlikely the Bank of England (BoE) will cut interest rates tomorrow. The Monetary Policy Committee will be wary that services inflation becomes stuck at an elevated level, and particularly after this week’s release of the October higher-than-expected average hourly earnings data, which is correlated to services inflation.”
This article was first published on Your Mortgage’s sister site, YourMoney.com. Read: Inflation hits 2.6% in November
