Inflation in the United Kingdom continues to surge growing past four per cent over the past 12-months.

England’s Office of National Statistics (ONS) is reporting that  the Consumer Prices Index including owner occupiers’ housing costs (CPIH) rose by 4.2 per cent in the 12 months to January 2024, same as it did in December 2023.

At the same time, the Consumer Prices Index (CPI) rose by 4.0 per cent, same as it did in December 2023. 

On a monthly basis, CPIH rose by 0.4 per cent in January 2024, the same rate as in January 2023, while CPI rose by 0.6 per cent in January 2024, the same rate as in January 2023. The primary factors influencing the yearly inflation rates for both CPIH and CPI are identical in cases where the measures overlap. 

Nevertheless, the ONS says,  “a significant distinction between CPIH and CPI inflation rates arises from the owner occupiers’ housing costs (OOH) element, which constitutes 16 per cent of CPIH. This aspect predominantly contributes to the disparities between the inflation rates of CPIH and CPI, thus establishing CPIH as our most all-encompassing gauge of inflation.”

The annual inflation rates for the Consumer Prices Index including owner occupiers’ housing costs (CPIH) in December 2023 and January 2024 showcased a balancing act driven by offsetting price movements across various divisions within the basket of goods and services. 

Notably, five divisions, including furniture and household goods, as well as food and non-alcoholic beverages, made downward contributions to the inflation rate. Conversely, three divisions, particularly housing and household services, along with transport, provided upward contributions.

The largest upward contribution to the monthly change in both CPIH and CPI annual rates came from housing and household services, principally higher gas (6.8 per cent) and electricity charges (4.0 per cent).

In the meantime, the largest downward contribution came from furniture and household goods, where prices fell by 5.2 per cent on the month, the largest monthly fall since January 2020 as well as food and non-alcoholic beverages, where prices fell by 0.4 per cent between December 2023 and January 2024 .