FTSE 100 LIVE: Stocks rise as UK inflation climbs above Bank of England target to 2.3%

Inflation in the UK has surged above the Bank of England’s 2% target, according to official figures, with the rise being driven by a sharp increase in energy bills.

The consumer prices index (CPI) rose to 2.3% in October, the Office for National Statistics (ONS) revealed. The jump, which exceeded analysts’ expectations, follows a decline to a three-year low of 1.7% in September.

Economists had anticipated a rise, warning that it was likely driven by higher energy costs after the energy price cap was raised for households in October.

The cap increase saw average household energy bills rise by £149 a year, following a 10% hike by the regulator Ofgem. The new cap for a typical dual-fuel household in England, Scotland, and Wales was set at £1,717, up from £1,568.

Grant Fitzner, chief economist at the ONS, said:

Services inflation rose from 4.9% to 5% in October, after analysts had expected it to remain unchanged.

Meanwhile, core inflation, which strips out volatile food and energy costs, also rose unexpectedly from 3.2% to 3.3%.It had been expected to fall to 3.1%.