October UK inflation set to rise, says Deutsche Bank

3.80% year-on-year is Deutsche Bank’s forecast for UK headline CPI in October. Economists Sanjay Raja and Maui Brennan expect energy, tobacco and modest increases in food and services prices to lift inflation, with Core CPI and Services CPI also moving higher. They project headline CPI approaching 4.25% early next year as price pressures remain persistent.

Deutsche Bank highlights resurgent inflation pressures

"After broadly matching expectations in September, we expect UK inflation to rise further in October."

"First, energy prices are set to push even higher as we enter the final quarter of the year, with the Ofgem Price Cap up, heating oil prices up, and petrol and diesel prices up too. Second, tobacco duty will also be a prominent feature of the October inflation report, with higher duties on vapes and tobacco kicking in."

"We expect headline CPI to have risen to 3.80% y-o-y (Sep-26: 3.48%). Core CPI, we think, will have jumped by 2.87% y-o-y (Sep-26: 2.78%). Services CPI, we project, will have edged up to 3.87% y-o-y (Sep-26: 3.72%)."

"We continue to see headline CPI pushing closer to 4.25% y-o-y at the start of next year."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)