What caused UK inflation to rise in December?

Increased airfares, higher cigarette prices due to duty changes, and rising entertainment costs significantly pushed up UK inflation last month.

Did grocery prices increase in December?

While some food items saw price rises, inflation for everyday groceries like butter and tea actually slowed down in December.

How much did airfares increase in the UK last month?

Average airfares in December saw a substantial year-on-year increase of 11.0%, compared to a modest 0.3% rise in November.

Home / Business and Economy / UK Inflation Soars: Airfares, Cigarettes Drive Prices Up

UK Inflation Soars: Airfares, Cigarettes Drive Prices Up

21 Jan

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Summary

Airfare costs surged 11.0% year-on-year in December, a significant jump.
Tobacco duty increases led to higher prices for cigarettes and cigars.
Grocery inflation eased, with butter and tea prices seeing a slowdown.

UK Inflation Soars: Airfares, Cigarettes Drive Prices Up

The UK's inflation rate experienced a notable acceleration in December, primarily driven by sharp rises in airfares and tobacco products. Consumer Prices Index data revealed that average airfares increased by 11.0% compared to the previous year, a significant jump from November's 0.3% rise. This surge is attributed to increased demand during the Christmas holiday season.

Further contributing to the upward pressure were increased prices for cigarettes and cigars, up 6.9% and 4.2% respectively year-on-year. These hikes are a direct consequence of a tobacco duty increase implemented in late November. Live entertainment, including cinema and concert tickets, also saw a notable price rise of 3.7% annually.

Conversely, some everyday food items offered a reprieve, with inflation easing for butter, tea, and other groceries. For example, the annual inflation rate for butter decreased from 12.1% to 8.9%. Prices also fell faster for items like heaters and air conditioners, and washing machines.