Inflation resumed its upward path in February in the United Kingdom, rising 10.4% year-on-year against 10.1% in January and putting pressure on the Central Bank to raise new rates.
Inflation resumed its upward path in February in the United Kingdom, rising 10.4% year-on-year against 10.1% in January, driven by food and clothing prices, said the Office for National Statistics (ONS). british.
“Rising alcohol prices in pubs and restaurants” contributed a lot to this surprise rebound, as well as “food and non-alcoholic beverages, which rose at the fastest rate in more than 45 years”stressed Grant Fitzner, economist at the ONS.
“The decline in inflation is not inevitable, we have to stick to our plan to halve inflation this year,” insisted British Finance Minister Jeremy Hunt in a statement, on the eve of a Bank of England decision on interest rates.
The central bank has to act to, on the one hand, calm the skyrocketing prices in the midst of the cost-of-living crisis in the United Kingdom, and on the other, not affect growth in a country on the verge of recession. The core CPI rose to 6.2% from 5.8% previously, also higher than expected.
The released CPI figure is no relief for the Bank of England, acknowledges Naeem Aslam, director of research at Zaye Capital Markets. “We know that inflation is a kind of beast that goes up a lot faster and goes down a lot slower. The fact that the UK headline inflation figure rose more has made life even more difficult for the BoE“, Explain.
“The cost of living crisis in the UK has received another reality check and things are still very difficult and there are no signs of abating, which means the BoE will have to do more,” Aslam adds.
“All eyes will be on tomorrow’s BoE meeting, where we believe rates will be raised by 25 basis points“, he concludes.
Source: Ambito
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