UK Records Rise in December 2025 Inflation
Monthly CPI increased 0.4 percent in December, outpacing the 0.3 percent rise recorded in December 2024, the data showed.
Inflation ticked up a little in December, driven partly by higher tobacco prices. Airfares contributed to the increase with prices rising more than a year ago, likely because of the timing of return flights over the Christmas and New Year period, said Grant Fitzner, chief economist at the ONS.
Escalating food expenses, especially for bread and cereals, added upward pressure, he noted, though the overall inflation figure was partially offset by declining rent inflation and reduced prices across various recreational and cultural purchases.
"Headline inflation took an unwelcome rise at the end of year, primarily driven by increases in food inflation and transport costs," said Harvir Dhillon, economist at the British Retail Consortium, "with food inflation climbing to 4.5 percent and wage growth slowing, households are still feeling the squeeze."
Stuart Morrison, research manager at the British Chambers of Commerce (BCC), characterized Wednesday's data as a "stark reminder that the UK inflation waters remain choppy."
The BCC's latest survey identifies inflation as a primary business concern, cited by 56 percent of respondents, he reported, warning that threatened U.S. tariffs in coming weeks will intensify price anxieties among firms.
"Headline inflation has been slow to fall from its summer peak and remains higher than at the start of the year," Dhillon said, explaining this reflects the high costs currently buffeting retail businesses, including National Insurance, labor costs and packaging taxes, all of which have pushed up costs.
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