Consumer prices in the United Kingdom (UK) rose 1.8 percent last month hitting its highest level since June 2014, according to the latest figures released by the Office for National Statistics (ONS).
Annual inflation as measured by the Consumer Prices Index (CPI) nudged 0.2 percent higher in January from December’s 1.6 percent. It is the fourth straight month that the CPI has gone up and pushes inflation to its highest point in two and a half years.
The ONS cited rising fuel costs and higher food prices as the two main drivers for the jump.
Analysts were projecting a 1.9 percent rise, but upward inflation pressures were tempered by falling clothing and footwear prices, which declined lower than they did the year before.
January’s inflation figures nudges the rate closer to the Bank of England’s 2 percent target. Forecasters are expecting UK Inflation to rise significantly in 2017 as the pound continues to shed its value against the dollar and the euro, making goods from abroad more expensive to import.
Earlier this month, UK’s central bank said it expects the inflation rate to rise 2.8 percent in the beginning of 2018.
In a separate report, ONS figures showed that prices paid by British manufacturers for fuel and materials ballooned at an annual rate of 20.5 percent in January, marking its sharpest surge since September 2008. This resulted in a 3.5 percent increase in the prices of goods leaving UK factories.Commenting on the rising cost of living in the UK, a Treasury spokesperson said that the government understands the concerns of British families, adding that it is cutting taxes for workers and has frozen duties levied on fuel to help everyday costs low.
Commenting on the rising cost of living in the UK, a Treasury spokesperson said that the government understands the concerns of British families, adding that it is cutting taxes for workers and has frozen duties levied on fuel to help everyday costs low. The move will save the average British driver approximately £130 a year, the spokesman added.
Meanwhile, consumer inflation as measured by the Retail Prices Index (RPI), which factors housing costs, climbed to 2.6% last month from 2.5% in December.
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