UK inflation rises to highest level in almost 30 years at 5.4%

[dutchman]

Surprise fall in inflation paves way for interest rate cuts



UK inflation fell unexpectedly to 1.7% in the year to September, the lowest rate in three-and-a-half years.

It means the annual rate prices are rising at is now below the Bank of England's 2% target, paving the way for further interest rate cuts.

Lower airfares and petrol prices were the main drivers behind the surprise slowdown, official figures showed, external.

Separately, September's inflation figure is also normally used to set how much many benefits will rise by next April.

UK interest rates are currently at 5%. The Bank made a first cut in August but decided to hold them last month.

It is already widely expected that they will be cut in November.

Yael Selfin, chief economist at KPMG UK, warned that although the Bank would be likely to drop rates next month, inflation is likely to rise again with household energy bills increasing this month by around 10%.

The surprise fall in inflation last month to 1.7, down from 2.2% in August, was mainly driven by airfares and fuel.

Petrol and diesel prices were significantly lower, dropping by 10.4% in September compared with the same month a year earlier.

Airfare prices for domestic, European and long-haul flights normally fall after the summer rush, but they fell more than normal last month.

However, food and non-alcoholic drink prices rose, with costs jumping for milk, cheese, eggs, soft drinks and fruit.

This was the first time food price inflation has risen March last year.

September's inflation data is normally used to calculate how much many benefits go up in April.

This includes the biggest: universal credit, which goes up at the government's discretion.

All the main disability benefits - personal independence payment, attendance allowance and disability living allowance - as well as carer’s allowance, go up by at least September's inflation rate by law.

The government has said it wants to shrink the UK's annual disability and incapacity benefits bill.

[dutchman]

There's no 'surprise' about it, inflation is always lowest in September. The government rigs it that way so they don't have to increase benefits more.

[rebbonk]

There's no 'surprise' about it, inflation is always lowest in September. The government rigs it that way so they don't have to increase benefits more.

Dead on, Dutchman. They think the public are stupid.

[dutchman]

Another example of 'shrinkflation'



There used to be EIGHT sachets in a box whereas now there are only SEVEN.

To make matters worse, you need at least TWO sachets in each cup to be able to taste them at all as they're so insipid but being an odd number you now need to buy at least TWO boxes or else have one sachet left over.

[dutchman]

NOT SAFE FOR WORK!

[dutchman]

£9.10 for medium fish and small chips tonight!

I'm not blaming the chip shop, it's still one of the cheapest in the city. Reeves' budget has put up all their expenses.

[dutchman]

UK inflation rate hits highest level for eight months



The UK inflation rate has gone up for the second month in a row, with prices rising at their fastest pace since March.

Inflation hit 2.6% in the year to November, according to official figures.

Fuel and clothing were among the main drivers behind the rise. Increasing ticket prices for gigs and plays were also a factor.

Analysts say the latest figures mean the Bank of England will almost certainly not cut interest rates when it meets on Thursday.

"Inflation rose again this month as prices of motor fuel and clothing increased this year but fell a year ago," said Grant Fitzner, chief economist at the Office for National Statistics (ONS), which gathered the data.

"This was partially offset by air fares, which traditionally dip at this time of year, but saw their largest drop in November since records began at the start of the century."

The official forecasting body said in October that inflation was likely to pick up to 2.6% in 2025 in part due to the impact of Budget measures announced in October.

Shadow chancellor Mel Stride said: "The chancellor has made a series of irresponsible and inflationary decisions."

"These figures mean higher costs in the shops, less money in working people's pockets and risks keeping mortgage rates higher for longer," he said.

Prices for food and non-alcoholic drinks, alcohol and tobacco, and footwear all rose at a faster pace last month.

A wider measure of inflation showed housing and household services costs, including rent, rose by 3.5% over the past year.

Sarah Coles, head of personal finance at the financial services firm, Hargreaves Lansdown, said: "Inflation is staying put for now, like an unwelcome Christmas party guest hogging the sofa into the small hours.

"The question is whether it can be shifted, or if it's going to hang around to ruin our plans for months – eating us out of house and home and driving up the cost of everything again," she said.