The Retail Prices Index, or RPI, is one of the UK’s oldest consumer-price measures. It is still used in parts of the economy, particularly in some contracts and forms of indexation, but it is not the inflation measure targeted by the Bank of England and the ONS does not class it as a National Statistic.
The latest reading is 3.2% RPI inflation in the year to July 2026. Over the same period, CPI was 2.9% and CPIH was 3.1%. The three measures often move in the same broad direction, but their construction is different enough that the rates do not match.
What RPI measures
Like CPI and CPIH, RPI follows the changing price of a basket of goods and services over time. It differs in the population it covers, the items and housing costs included, and the mathematical formula used to combine price changes. Those methodological differences create a persistent “formula effect” that has often left RPI above CPI.
RPI also includes some housing-cost components that CPI excludes. This is one reason the gap can change materially when mortgage interest rates move.
RPI versus CPI
CPI is the measure used for the Bank of England’s 2% inflation target. When the MPC says inflation is above or below target, it means CPI. As of July 2026, CPI was 2.9%.
RPI is still economically relevant because legacy contracts and index-linked arrangements can reference it. But it should not be substituted into a discussion of monetary-policy target inflation. Saying “inflation is 3.2%” because RPI is 3.2% would be misleading in a Bank Rate context; the policy measure is CPI.
Where CPIH fits
CPIH extends CPI to include owner-occupiers’ housing costs using a rental-equivalence approach, alongside Council Tax. The ONS presents CPIH as its most comprehensive measure of consumer-price inflation. CPIH was 3.1% in July 2026.
So the three July readings answer related but different questions: CPI at 2.9% is the monetary-policy target measure; CPIH at 3.1% is the ONS’s broader consumer-price measure including owner-occupier housing costs; RPI at 3.2% is a legacy measure that remains embedded in parts of the financial and contractual system.
Why RPI still matters to investors and households
Index-linked gilts have historically used RPI-linked cash flows, which makes the measure relevant to government financing and inflation-linked assets. Some regulated prices, pensions and private contracts have also used it. The exact treatment depends on the instrument or contract, so the index written into the legal terms matters more than whichever inflation measure is currently most prominent in the news.
For households, RPI can sometimes feel closer to changes in financing costs because of its treatment of mortgage interest, but that does not make it a universally “truer” cost-of-living measure. Different indices are built for different statistical purposes.
Which inflation measure should you use?
Use CPI when discussing the Bank of England’s target or comparing the official target with current inflation. Use CPIH when you want the ONS’s broad consumer-price measure including owner-occupier housing costs. Use RPI when a specific contract, bond or historical series is actually indexed to RPI.
For where inflation is heading rather than how each index is built, see the UK inflation outlook. For the policy response, see the UK interest-rate outlook.
Primary source
- Office for National Statistics: Consumer price inflation, UK, July 2026.
- Office for National Statistics: Inflation and price indices.
Checked 11 September 2026. The next UK consumer-price release is scheduled for 16 September 2026.