# Inflation bounces back in December as Christmas travel fuels price rises

By Matt Britzman — 2026-01-21

Matt Britzman, senior equity analyst at Hargreaves Lansdown, said: “UK markets kicked off the session broadly flat as investors weighed up the latest December inflation data.

“CPI came in at 3.4 per cent, fractionally above the 3.3 per cent expected, but a touch below the Bank of England’s forecast.

“From a market perspective, this doesn’t materially shift the narrative, with a February rate cut effectively off the table.

“The picture looks more encouraging in April when another cut is expected, as inflation could fall sharply towards the two per cent target with regulated price increases coming in lower than last year.”

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