The consumer prices index (CPI) held steady at 3.8 percent year-over-year, unchanged from August, while the broader CPIH measure, which includes owner occupiers' housing costs, also stayed firm at 4.1 percent. On a monthly basis, CPI recorded no movement, and CPIH increased marginally by 0.1 percent mirroring trends from the same period last year.

Transport costs exerted the strongest upward influence on inflation, suggesting persistent fuel and travel-related expenses, while lower prices in recreation, culture, and food provided balancing relief for households. Core inflation, which strips out volatile items such as energy and food, showed a slight cooling as core CPI dipped to 3.5 percent and core CPIH to 3.9 percent. Goods inflation edged up modestly to 2.9 percent, whereas services inflation remained elevated at 4.7 percent for CPI and 4.9 percent for CPIH, emphasizing ongoing price rigidity in the service sector.

Indeed, the latest updates indicate that inflationary pressures have plateaued rather than receded. This reflects a mixed environment where easing core prices contrast with persistently high service costs. This latest update takes the RPI to minus 13 and the RPI-P to 1, meaning that economic activities are underperforming compared to expectations in the UK.

UK annual inflation seen at a shocking 4.0 percent in September after an already nasty 3.8 percent in August. Month on month, the consensus looks for an increase of 0.2 percent after rising 0.3 percent in August.

The consumer price index (CPI) is an average measure of the level of the prices of goods and services bought for the purpose of consumption by the vast majority of households in the UK. It is calculated using the same methodology developed by Eurostat, the European Union's statistical agency, for its harmonised index of consumer prices (HICP). The CPI is the Bank of England's target inflation measure.

The consumer price index is the most widely followed indicator of inflation. An investor who understands how inflation influences the markets will benefit over those investors that do not understand the impact. In countries such as the UK, where monetary policy decisions rest on the central bank's inflation target, the rate of inflation directly affects all interest rates charged to business and the consumer. Inflation is an increase in the overall price level of goods and services. The relationship between inflation and interest rates is the key to understanding how indicators such as the CPI influence the markets - and your investments.

Inflation (along with various risks) basically explains how interest rates are set on everything from your mortgage and auto loans to Treasury bills, notes and bonds. As the rate of inflation changes and as expectations on inflation change, the markets adjust interest rates. The effect ripples across stocks, bonds, commodities, and your portfolio, often in a dramatic fashion.

By tracking inflation, whether high or low, rising or falling, investors can anticipate how different types of investments will perform. Over the long run, the bond market will rally (fall) when increases in the CPI are small (large). The equity market rallies with the bond market because low inflation promises low interest rates and is good for profits.

For monetary policy, the Bank of England generally follows the annual change in the consumer price index which is calculated using the European Union's Eurostat methodology so that inflation can be compared across EU member states.