News Story

UK inflation bounced back in December as tobacco duty hikes and Christmas getaways helped push up the cost of living, official figures show.

The rate of Consumer Prices Index (CPI) inflation rose to 3.4% in December from 3.2% in November, the Office for National Statistics (ONS) said.

Inflation has been static or falling since last summer, and had fallen sharply in November following an easing of rising food costs.

However, December’s CPI rate comes in slightly below the 3.5% that a consensus of economists had been forecasting for the month.

ONS chief economist Grant Fitzner said: “Inflation ticked up a little in December, driven partly by higher tobacco prices, following recently introduced excise duty increases.

“Air fares also 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.

“Rising food costs, particularly for bread and cereals, were also an upward driver.

“These were partially offset by a fall in rents inflation and lower prices for a range of recreational and cultural purchases.”