PwC comments on the latest October 2024 CPI figures

Commenting on the Office of National Statistics Consumer Price Index for October 2024, Gora Suri, Economist at PwC UK, comments:

“Headline CPI inflation nudged up to 2.3% in October, a touch higher than consensus expectations and the Bank’s latest projections. An uptick in inflation was expected, given the 10% rise in the Ofgem energy price cap which was introduced at the start of October.

“Looking ahead, upside risks to inflation have mounted. Last month’s Budget is likely to contribute to inflationary pressures in the short-term, both through the direct fiscal impulse and the indirect impact of specific policies. In particular, increases in employer NICs and the National Living Wage could place upwards pressure on consumer prices as some companies may raise prices to absorb increased costs. 

“Geopolitical developments could also play a significant role in the evolution of inflation over the next year, via supply chain disruptions, greater trade fragmentation and higher energy and commodity prices.

“There will be one more inflation print before the Bank of England’s next interest rate decision in December. In the absence of any major downside surprises, we expect the Bank to pause the rate-cutting cycle next month before resuming early next year.”