Inflation In The UK Reaches A Record High Of 40 Years

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Inflation In The UK Reaches A Record High Of 40 Years
20 Oct 2022
6 min read

News Synopsis

Inflation hit a 40-year high of 10.1 percent in September as food prices rose in Britain. The UK's National Statistical Office released consumer price index-based inflation data for September on Wednesday, saying the index jumped 10.1 percent for the month. Inflation had risen to 9.9 percent in August.

New inflation data show that inflation in the UK has reached its highest level since early 1982. During this period, inflation touched this level in July 2022 as well. The statistics office said food products were a major contributor to the sharp rise in inflation in September. Food inflation during this period rose to 14.5 percent as compared to a year ago. This is the highest food inflation since 1980. In view of this high level of inflation, the possibility of a further increase in the policy interest rate by the Bank of England has increased. The British central bank has been trying to bring inflation down to 2 percent, but so far it has met with failure.

Jeremy Hunt, the incoming finance minister, will find it harder to restore financial stability at the same time. Hunt, who assumed office last week, promised that the administration would put the needs of the weakest people first.
At the wholesale level, there were also indications of stickier inflation. In September, the cost of goods leaving factories as measured by producer prices increased by 15.9%. Though slightly slower than anticipated, that was nevertheless better than the prior month. Over predictions, the price of raw materials increased by 20%.

TWN Special