Higher energy bills push UK inflation to 2.3%

A rise in energy bills has pushed UK inflation to its highest rate for six months.

The inflation rate, which measures price changes over time, rose by more than expected to 2.3% in the year to October, up from 1.7% in September.

Annual gas and electricity bills for a typical household went up by about £149 last month although prices are rising much more slowly than in recent years.

The latest inflation figure comes after the government revealed that an additional 50,000 pensioners will be living in relative poverty next year as a result of cuts to the winter fuel allowance.

Higher inflation pushes up the cost of living for households, and can lead to interest rates remaining at a higher level, making the cost of loans, credit cards and mortgages, more expensive.

Inflation has fallen from its peak in October 2022. Prices are not falling, but are now rising less quickly.

However, there are concerns the cost of living will rise further, with firms warning they will raise prices to cover new taxes in the Budgt and, due to potential trade taxes imposed by the US, with Donald Trump pledging a 20% tariff on all imports.

While higher energy costs drove inflation higher last month, the increase was offset by falls in live music and theatre ticket prices, as well as a drop in raw material prices for businesses.

Inflation in the services sector, which measures price rises for things such as haircuts, airfares and hotels, ticked up to 5%, but food price inflation remained unchanged.

However, prices for staples such as cheddar cheese, baking potatoes and butter have all gone up in the last 12 months.

Read more here on five ways to cut costs this winter.