Inflation rises to 3.2% in October

CPI annual inflation – the Government’s target measure – was 3.2 per cent in October, up from 3.1 per cent in September.

The largest upward pressures to the change in CPI inflation came from:

fuel and lubricants where prices, overall, rose by 1.8 per cent between September and October this year compared to a fall of 0.7 per cent a year ago. This largely reflects a rise of 2.1 pence per litre in the price of petrol between September and October this year compared with a fall of 0.8 pence per litre a year ago. The rise in fuel prices this year includes the impact of the increase in road fuel duty, which took effect from 1 October 2010

financial services where prices, overall, fell by less than a year ago. There were significant reductions in bank overdraft charges and mortgage arrangement fees between September and October last year which have not been repeated this year

games, toys and hobbies where prices, overall, rose by 1.9 per cent this year compared to an increase of 0.4 per cent a year ago. The main upward effect this year came from computer games bought on the high street (rather than via the internet) where prices rose sharply

alcoholic beverages and tobacco where prices, overall, rose by 0.8 per cent between September and October this year but fell by 0.2 per cent a year ago. No one component drove the upward contribution but there were small upward effects from wine, beer and tobacco

The largest downward pressure to the change in CPI inflation came from:

food where there were widespread downward effects. The most significant downward pressures came from vegetables and meat. Within vegetables the largest downward effects came from potato crisps and cauliflowers. The main downward effects in meat came from pig related products where it has been reported that healthy stock levels have helped push prices down

RPIX inflation – the all items RPI excluding mortgage interest payments – was 4.6 per cent in October, unchanged from September.

As an internationally comparable measure of inflation, the CPI shows that the UK inflation rate in September was above the provisional figure for the European Union. The UK rate was 3.1 per cent whereas the EU’s as a whole was 2.2 per cent.