The UK inflation rate rose to 4% in the year to December.

Economists had been forecasting a fall from 3.9% last month to 3.7%.

But tobacco and alcohol price rises have largely driven an unexpected increase instead, according to the Office for National Statistics (ONS).

The Bank of England is still expected to cut interest rates later this year, despite the shock rise.

Chancellor Jeremy Hunt said inflation "does not fall in a straight line" but insisted "our plan is working", reported the BBC.

His Labour counterpart Rachel Reeves said the rise in prices is bad news for everyone and the country cannot afford five more years of "economic failure".

Inflation, which measures the pace at which prices are rising, has been slowing down in the UK since peaking at 11.1% in October 2022.

But the cost of living remains high - the Bank of England's target for inflation is 2%

France, Germany and the US have also seen similar rises in inflation.