UK Inflation eased further than expected last month, adding to expectations for the Bank of England to cut interest rates ahead of Christmas.
The Consumer Prices Index (CPI) inflation has fallen to 3.2 per cent in November, down from 3.6 per cent in October, according to figures announced on Wednesday morning.
This marks the lowest CPI rate since March this year and a bigger drop than the 3.5 per cent that most economists were expecting for the month.
The Office for National Statistics (ONS) figures mean an interest rate cut – to 3.75 per cent – now appears highly likely when the the Bank of England’s monetary policy committee makes its decision on Thursday.
The inflation figures mean that prices are still rising across the country, but at a slower rate than they were before.
Food and drinks, as well as alcohol and tobacco, were the biggest factors pulling on the overall rate of inflation last month.
Chancellor Rachel Reeves said lowering household bills was a “top priority” after the latest inflation data was released.
Key Points
- Inflation falls to 3.2 per cent
- Christmas interest rate cut expected after inflation figures
- Lowering household bills 'top priority', Reeves says
- Lower food and tobacco prices contributed to fall
Analysis: Strikes come 'hospitals feel they are buckling'
10:20 , Athena StavrouHealthcare leaders have warned the timing of doctors strikes meant an additional pressure at a time when hospitals feel they are buckling.
Those managing services and consultants working on wards have admitted to The Independent services tend to run more smoothly during strikes as there are senior clinicians making the decisions.
However, this strike comes the week before Christmas during which time hospitals are usually scrambling to clear beds ready for an onslaught in the days after Christmas and the first week of the new year.
In addition to these, hospitals are facing an early flu peak.
Consultants are going to be “more knackered” due to the strikes, the Health Secretary Wes Streeting told the Health Committee on Thursday morning, this echoed a consultant's words to The Independent last week that the strikes have come during the worst weekend.
The question remains for how long will consultants be happy to put in the extra hours to cover these ongoing strikes? There is also a major cost to having consultants cover resident doctor shifts.
While the strike days may not be a disaster for hospitals the action will undoubtedly be a big hit.
Streeting: Walkout to cost NHS £250m
10:19 , Athena StavrouThe health secretary has said the resident doctor strike will cost the health service £250 million.
Appearing before the Health and Social Care Committee, Wes Streeting said he was “entirely focused on getting the NHS through the next five days” as the walkout begins.
He added: “These strikes are going to come at a cost around a quarter of a billion pounds.”
Resident doctor strike underway
10:00 , Athena StavrouAbout 30 people outside the Royal Liverpool University Hospital are stood under orange British Medical Association (BMA) umbrellas on a picket line.
The doctors, from hospitals across Liverpool, held placards reading: “Doctors need jobs now.”
Some cars beeped their horns as they passed the hospital.
House prices rise despite inflation fall
09:54 , Athena StavrouThe average UK house price increased by 1.7 per cent, to £270,000 annually in October, slowing from 2.0 per cent in the 12 months to September, the Office for National Statistics (ONS) said.
Property values increased to reach £292,000 (a 1.4 per cent annual increase) on average in England, £211,000 (1.5 per cent) in Wales, and £192,000 (3.3%) in Scotland, in October.
The average house price in Northern Ireland in the third quarter of 2025 was £193,000 – a 7.1 per cent annual increase.
Within England, the North East had the highest annual house price inflation in October, at 5.0 per cent. Annual house price inflation was lowest in London, where the average house price fell by 2.4 per cent.
Average UK house prices increased by 1.7%, to £270,000 in the 12 months to October 2025, down from 2.0% in the 12 months to September.
— Office for National Statistics (ONS) (@ONS) December 17, 2025
Average UK private rents rose by 4.4%, to £1,366 in the 12 months to November 2025, down from 5.0% in the 12 months to October. pic.twitter.com/qebtXK8pMq
Streeting apologises to patients for strikes
09:48 , Athena StavrouHealth Secretary Wes Streeting apologised to patients for the disruption caused by the strikes.
He told broadcasters: “We did everything we could to avert these strikes and to stop strike action from taking place.
“When we came into Government, we recognised what resident doctors were saying about pay, and that’s why they received a 28.9 per cent pay rise from this Government.
“And of course, we’re willing to talk to them about what we do in future years.
“I think people can see that I’ve tried my absolute best to avoid these strikes on what is the worst time for the NHS. I’m really sorry to patients for the disruption that is happening as a result.”
He said the Government met with British Medical Association (BMA) representatives on Tuesday to see if “even at the 11th hour, we could avert the strikes”, but added: “After constructive discussions, we still weren’t able to persuade the BMA either to come into negotiations or indeed to delay strikes to January.”
What is happening in UK politics today?
09:37 , Athena StavrouThis morning’s inflation figures have provided a boost for the chancellor Rachel Reeves, but her fellow ministers have a busy day ahead.
On the first day of five-day resident doctors strike, health secretary Wes Streeting is appearing before the Health and Social Care Committee.
At midday, Sir Keir Starmer will face PMQs in the Commons as usual, with Kemi Badenoch likely to grill him over the doctor’s walkout.
FTSE100 gets a boost after better than expected inflation figures
09:27 , Athena StavrouThe FTSE100 climbed higher on Wednesday morning after the release of today’s inflation figures.
The index is up 1.28 per cent since opening.
Bank of England likely to cut interest rates - expert
09:11 , Athena StavrouExperts have said the Bank of England will likely cut interest rates this week after a fall in inflation.
Nicolas Crittenden, associate economist at the National Institute of Economic and Social Research (NIESR), said: “Today’s figures suggest inflation is back on a downward path, falling in consecutive months for the first time since March.
“Though still above target, this trajectory means the Bank of England will likely cut Bank Rate tomorrow, but a close decision is expected.
“We predict inflation will continue to fall into 2026 as slowing wage growth and disinflationary effects from the recent Budget feed through the economy. The Bank of England will remain cautious about cutting rates further with inflation expected to remain above target for some time, but we still expect a further cut in the first half of 2026.”
Expect bigger discounts on Christmas shopping, expert says
08:59 , Athena StavrouKris Hamer, director of insight at the British Retail Consortium (BRC), said the fall in inflation was driven by “extensive discounting by retailers across Black Friday month”.
“With many customers kicking off their Christmas shopping, there will have been relief to see the price of clothing and footwear fall on the year,” he said.
“And while high labour and commodity costs have pushed up food inflation over 2025, bigger promotions ahead of Christmas helped to bring this figure down.
“As a result, there were deals to be had, with bigger discounts seen for some meat products such as pork, lamb and chicken.”
Graph: UK inflation rate
08:43 , Athena StavrouChristmas interest rate cut expected after inflation figures
08:34 , Athena StavrouUK Inflation eased further than expected last month, adding to expectations for the Bank of England to cut interest rates ahead of Christmas.
The Office for National Statistics (ONS) figures mean an interest rate cut – from 4 per cent to 3.75 per cent – now appears highly likely when the the Bank of England’s monetary policy committee makes its decision on Thursday.
Price rises 'deeply concerning' for families, shadow chancellor says
08:18 , Athena StavrouTory shadow chancellor Sir Mel Stride has welcomed today’s inflation figures, but warned “prices are still rising at well above the target rate”.
“While a fall in inflation is welcome, prices are still rising at well above the target rate which will be deeply concerning for families,” he said.
“Last year, Labour hiked taxes and ramped up borrowing, stoking inflation. This year, their Budget made the same mistake, raising taxes to pay for higher benefits spending.
“With unemployment rising and the economy shrinking, families are paying the price for Labour’s bad choices. Only the Conservatives have a leader with a backbone, a clear plan, and a strong team to deliver a stronger economy and get inflation under control.”
Lowering household bills 'top priority', Reeves says
08:00 , Nicole Wootton-CaneChancellor Rachel Reeves said lowering household bills was a “top priority” after official figures showed inflation fell to 3.2 per cent last month.
She said: “I know families across Britain who are worried about bills will welcome this fall in inflation.
“Getting bills down is my top priority. That is why I froze rail fares and prescription fees and cut £150 off average energy bills at the Budget this year.
“The Bank of England agree this will help cut prices and expect inflation to fall faster next year as a result.”
Analysis: Inflation rates will allow businesses to plan with more security
07:53 , Nicole Wootton-CaneThe Independent’s business and money editor Karl Matchett reports:
On a wider economic picture, continued disinflation will be seeing businesses hope the government will back them properly in the new year. Nobody came out of the Budget particularly happy about their lot, but they will now at least be able to plan with more security and knowledge - the three months before Rachel Reeves' numbers were revealed were full of hesitation, disinclination to spend and hiring on a downward spiral.
It's important now, if inflation continues to slow, that firms are able to put projects in place to stimulate their own growth and, in turn, that of the UK economy - job No1 for the government all of this year, but not one they've done terribly well at encouraging.
The Trades Union Congress (TUC) are already calling for a number of further interest rate cuts early next year, saying "high interest rates are draining confidence from households and firms. It’s vital that we now boost demand."
The TUC also called out the Bank of England for being "too cautious" and said “lower rates will give firms the confidence to invest and help get more households spending.”
Analysis: Inflation falling means 'sure-fire bet' for interest rate cuts
07:42 , Nicole Wootton-CaneThe Independent’s business and money editor Karl Matchett reports:
Today's data shows a steeper decline in inflation than anticipated, but the Bank of England (BoE) will be aware there's still lots to do to get down to their 2 per cent target - which they have suggested we won't reach until summer of 2027.
It also means a potentially easier vote coming from their MPC tomorrow; stickier inflation would have left one or two members hesitant about cutting interest rates, but as inflation comes down alongside unemployment going up and wage growth slowing, it's looking an absolute sure-fire bet now that the base rate will be cut to 3.75 per cent.
What will that mean for peoples' money? Well if you're on a variable rate or tracker mortgage, payments should come down. If you're about to renew or considering a new deal, the advice has been to get one locked in right away - plenty of mortgage products are at or below 4 per cent now. And if you've been considering locking away some money in a fixed-term deal for a year or so, if you don't do it today then you can expect most of the best rates to be gone from tomorrow onwards - and standard savings accounts (or cash ISAs) will see their rates likely drop swiftly too.
'More to do' after fall in inflation, Reeves says
07:31 , Nicole Wootton-CaneRachel Reeves has said there is “more to do” after a drop in food prices drove a fall in inflation in October.
In a post on X the chancellor said she knew families struggling with the cost of living would “welcome” the news.
She added Labour had taken a number of measures at the Budget, including freezing rail fares, to keep pushing for lower everyday prices.
I know families across Britain who are worried about the cost of living will welcome this fall in inflation.
But there is more to do.
That is why at the Budget we froze rail fares and prescription charges and will be cutting £150 off the average energy bill next year.
'Notable' fall in inflation caused by lower food prices, economist says
07:25 , Nicole Wootton-CaneONS chief economist Grant Fitzner said: “Inflation fell notably in November to its lowest annual rate since March.
“Lower food prices, which traditionally rise at this time of the year, were the main driver of the fall, with decreases seen, particularly for cakes, biscuits and breakfast cereals.
“Tobacco prices also helped pull the rate down, with prices easing slightly this month after a large rise a year ago. The fall in the price of women’s clothing was another downward driver.
“The increase in the cost of goods leaving factories slowed, driven by lower food inflation, while the annual cost of raw materials for businesses continued to rise.”
What does a fall in inflation mean?
07:18 , Nicole Wootton-CaneThe Office for National Statistics (ONS) has reported a fall in inflation this morning.
The figure sits at 3.2 per cent, down from 3.6 per cent in October.
This means that while prices are still rising, they are rising more slowly than they were earlier this year.
Sanjay Raja, chief UK economist for Deutsche Bank, said we saw a “peak” in inflation in August, but that the figures represent a downward trend.
“Autumn Budget measures have lowered our projections for inflation for next year – particularly in the spring. Lower energy prices have also helped lower our projections,” he said.
“We see CPI landing pretty close to target from spring next year before more sustainably returning to target in 2027.”
Lower food and tobacco prices contributed to fall, ONS economists say
07:09 , Nicole Wootton-CaneLower prices for items such as food and tobacco have helped contribute to last month’s falling inflation, economists have said.
The Office for National Statistics’ chief economist Grant Fitzner said decreases were seen particularly for cakes, biscuits, and breakfast cereals.
BREAKING: Inflation falls to 3.2 per cent
07:03 , Nicole Wootton-CaneThe Consumer Prices Index (CPI) rose by 3.2 per cent in the 12 months to November 2025, down from 3.6 per cent in October 2025.
This is its lowest annual rate since March.
