Inflation hits 30-year excessive | Publish

Inflation reached 5.4% in December, its highest charge since CPIH stood at 5.1% in Could 1992, in response to the newest figures from the Workplace for Nationwide Statistics (ONS).

It revealed the buyer costs index together with proprietor occupiers’ housing prices (CPIH) rose 4.8% within the 12 months to December 2021, up from 4.6% within the 12 months to November.

In December 2021, the CPI rose by 0.5% from the earlier month, in contrast with an increase of 0.3% in the identical month the earlier 12 months.

The biggest upward contributions to the December 2021 CPIH 12-month inflation charge got here from housing and family companies and transport.

It additionally reported the biggest enhance within the CPIH 12-month inflation charge between November and December 2021 got here from meals and non-alcoholic drinks, eating places and motels, furnishings and family items, and clothes and footwear – partially offset by massive downward contributions to vary from transport, and recreation and tradition.

Unbiased analysis consultancy Capital Economics expects inflation to peak at 7% in April.

Paul Dales, chief UK economist at Capital Economics, stated: “The biggest contribution to the rise in inflation got here from an increase in meals worth inflation from 2.4% to a nine-year excessive of 4.5%.”

Alpesh Paleja, CBI lead economist, stated: “We’ve not seen the tip of rising inflation but. We count on it to peak within the months forward, not least if, as anticipated, the vitality worth cap is raised.

“With costs on the rise and actual wages already falling, it’s probably households will face a cost-of-living crunch for a lot of this 12 months.”

He added: “And with worth pressures additional up the provision chain nonetheless robust, the price of doing enterprise may even proceed to climb sharply.

“It’s now very important that the Authorities comes ahead with pressing options to guard essentially the most susceptible customers, who will wrestle most with anticipated worth rises. Options should even be discovered for companies which are scuffling with ever-growing value burdens, particularly energy-intensive companies. This needs to be a precursor to longer-term vitality market reforms, to construct resilience towards future vitality worth shocks.”

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