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Prices in the UK went up by 2.3% in the 12 months to October, which means inflation is back above the Bank of England's target.
The Bank puts interest rates up and down to try to keep inflation at 2%.
In November, it cut rates for the second time in 2024, taking them to 4.75%.
What is inflation?
Inflation is the increase in the price of something over time.
For example, if a bottle of milk costs £1 but is £1.05 a year later, then annual milk inflation is 5%.
How is the UK's inflation rate measured?
The prices of hundreds of everyday items, including food and fuel, are tracked by the Office for National Statistics (ONS).
This virtual "basket of goods" is regularly updated to reflect shopping trends, with vinyl records and air fryers added in 2024, and hand sanitiser removed.
The ONS monitors price changes over the previous 12 months to calculate inflation.
The main inflation measure is called the Consumer Prices Index (CPI).
CPI rose by 2.3% in the year to October 2024, up from 1.7% in the 12 months to September. The October figure is the highest rate for six months.
This was largely as a result of increased gas and electricity prices after the energy cap went up on 1 October.
The September CPI figure of 1.7% decided how much many benefit payments will go up in April 2025.
However, the state pension will rise by 4.1%, under an arrangement called the triple lock.
Why are prices still rising?
Inflation has fallen significantly since it hit 11.1% in October 2022, which was the highest rate for 40 years.
However, that doesn't mean prices are falling - just that they are rising less quickly.
Inflation soared in 2022 because oil and gas were in greater demand after the Covid pandemic, and energy prices surged again when Russia invaded Ukraine.
It then remained above the Bank of England's 2% target partly because of high food prices.
Some parts of the economy, like the services sector - which includes everything from restaurants to hairdressers - are still seeing significant price rises.
Why does putting up interest rates help to lower inflation?
The Bank of England uses interest rates to try and keep inflation at the 2% target.
When inflation was well above that level, it increased interest rates to 5.25%, a 16-year high.
The idea is that if you make borrowing more expensive, people have less money to spend. People may also be encouraged to save more.
In turn, this reduces demand for goods and slows price rises.
But it is a balancing act - increasing borrowing costs risks harming the economy.
For example, homeowners face higher mortgage repayments, which can outweigh better savings deals.
Businesses also borrow less, making them less likely to create jobs. Some may cut staff and reduce investment.
What has happened to UK interest rates?
In November 2024, the Bank of England cut rates to 4.75%, in a move that had been widely expected.
It followed a drop from 5.25% to 5% in August, the first fall for four years.
The Bank also considers other measures, such as "core inflation" when deciding how to change rates.
Core inflation doesn't include food or energy prices because they tend to be very volatile, so can be a better indication of longer term trends. It was 3.3% in October, up from 3.2% in the year to September.
In October, the Bank governor Andrew Bailey said it could be a "bit more aggressive" at cutting borrowing costs, if inflation remained under control.
However, after the Budget at the end of that month, the Bank predicted that the measures it contained - such as an increase in National Insurance Contributions paid by employers - will lift inflation slightly as businesses pass on their increased costs through higher prices.
Announcing the November rate decision, Mr Bailey indicated any further cuts were likely to be gradual, adding: "We need to make sure inflation stays close to target, so we can't cut interest rates too quickly or by too much."
Are wages keeping up with inflation?
The latest official quarterly figures show that pay grew at its slowest rate for more than two years between July and September.
Average annual growth in pay (excluding bonuses) during the three-month period was 4.8%, down from 4.9% between June and August.
Despite the slowdown, wages are still rising faster than inflation.
What is happening to inflation and interest rates in Europe and the US?
Many other countries have also seen the past few years' higher inflation and interest rates fall back.
The inflation rate for countries using the euro was 1.8% in September, down from 2.2% in August and 2.6% in July.
In June, the European Central Bank (ECB) cut its main interest rate from an all-time high of 4% to 3.75%, the first fall in five years.
It cut rates again to 3.5% in September.
US inflation was 2.6% in October, up from to 2.4% in September as a result of higher housing and food costs.
At its September meeting, the US central bank lowered rates for the first time in four years, cutting its key lending rate by 0.5 percentage points to between 4.75% and 5%.
The cut was larger than many analysts had predicted.
In November, the Federal Reserve announced a further cut, taking the key rate to between 4.5% and 4.75%.
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