UK inflation at decade high of 5.1 percent

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LONDON — Consumer price inflation in the U.K. reached 5.1 percent in the 12 months to November, the highest rate since September 2011, according to data released Wednesday by the Office for National Statistics.

The same measure of inflation stood at 4.2 percent in October, with fuel and retail products driving the “broad based” surge. Hotel and restaurant prices declined in the period.

“A wide range of price rises contributed to another steep rise in inflation, which now stands at its highest rate for over a decade,” said ONS Chief Economist Grant Fitzner. “The costs of goods produced by factories and the price of raw materials have continued to increase significantly to their highest rate for at least twelve years,” he added.

Chancellor Rishi Sunak said that “we know how challenging rising inflation can be for families and households,” pointing to government aid for the vulnerable through the winter.

Labour slammed Sunak for not doing enough to help the poor and boost performance in light of the numbers Wednesday. “From the energy price cap going up, soaring food costs and fuel prices hitting another record high – the list of price crunches as inflation continues to rise goes on and on,” said Pat McFadden, shadow economic secretary to the Treasury. “Instead of taking action, the government are looking the other way, blaming ‘global problems’ while they trap us in a high tax, low growth cycle.”

The increase in inflation was higher than expected by financial experts and comes a day before the Bank of England reveals its latest interest rate decision.

Were it not for a rapidly spreading Omicron variant of the coronavirus, a rate hike would be on the cards to bring inflation closer to the BoE’s target of 2 percent.

However, uncertainty surrounding the potential effects of the virus is casting doubt on the central bank’s willingness to step in.

Source: Politico