UK CPI eases to 3.6% in October, strengthens BoE cut expectations

Wednesday, November 19, 2025 at 10:30 UTC+01:00 (+0100), United Kingdom, London

News category : Macroeconomic Events

The Office for National Statistics reported that UK headline CPI slowed to 3.6% year-on-year in October, down from 3.8% in September. The decline was driven mainly by smaller increases in gas and electricity prices, partly offset by rising food inflation. Core measures also moderated slightly. Markets swiftly moved to price in a nearer-term easing by the Bank of England, with gilt yields falling and sterling weakening versus major peers. The data arrived days before the government’s autumn budget and increased focus on sterling-sensitive assets as traders reassessed the timing and size of BoE policy moves. Economists highlighted that while inflation is easing, services inflation and wage dynamics keep policy decisions finely balanced.

Overall market impact

Mild bullish market impact - strength score : 72/100

Detailed breakdown of market impact over instruments, sectors, and asset classes

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Impacted instruments :

GBP/USD and GBP pairs

UK gilts

UK equities

Bank of England rate futures

UK corporate bonds

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