UK inflation over time

Inflation is how fast prices are rising — the percentage by which the cost of a typical basket of goods and services is higher than a year earlier. The line below tracks the UK’s headline measure, the Consumer Prices Index (CPI), for each year since 1989. Hover or tap to read off any year; the dashed line marks the Bank of England’s 2% target.

Note what the chart does not show: even when inflation falls, prices are usually still rising — just more slowly. Prices only actually fall when the line dips below zero, which in the annual figures shown here never quite happened — 2015’s 0.0% was the closest. The cost-of-living jump of 2022–23 is the steep peak on the right; it was the highest inflation the UK had seen in four decades.

What the chart shows

• The early-1990s. Inflation was still high (and volatile) as the UK left the European Exchange Rate Mechanism on Black Wednesday in 1992 and adopted formal inflation targeting.
• Independence and calm. In 1997 the new government gave the Bank of England operational independence to set interest rates and hit an inflation target (2% on the CPI from 2003). For a decade inflation stayed low and stable — part of what economists called the “Great Moderation.”
• The 2008 and 2011 bumps. Spikes in oil, food and import prices — and a VAT rise — pushed inflation above target even as the economy was weak.
• Near-zero in 2015. Collapsing global oil prices briefly took inflation to roughly zero.
• The cost-of-living crisis. Post-pandemic supply bottlenecks and a surge in gas prices after Russia’s 2022 invasion of Ukraine drove CPI to a peak of 11.1% in October 2022 — the highest since the early 1980s — before it eased back toward target.

How it’s measured

The ONS prices a representative basket of hundreds of goods and services each month and reports how much it has changed over the previous twelve months. The figures here are annual averages of that monthly rate, so a single bad month (like the 11.1% October 2022 peak) is smoothed into the yearly number. The UK has used several measures over time — the older Retail Prices Index (RPI), the CPI (the target measure since 2003), and CPIH (which adds owner-occupier housing costs). This chart uses CPI for a consistent, long, comparable line.

Sources

• ONS — Inflation and price indices (CPI annual rates).
• Bank of England — inflation and the 2% target.
• House of Commons Library — inflation: economic indicators.

Some of the figures in the charts and tables on this page were compiled with the help of AI tools and may contain errors or be out of date. They are shared in good faith for general interest only — not as professional, financial, investment or purchasing advice — and should be checked against the cited primary sources before you rely on them.