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The Consumer Price Index (CPI) rate of inflation for February 2023 increased from 10.1 percent to 10.4 percent. Britons have been forced to contend with inflation-hiked prices, soaring energy bills and skyrocketing interest rates amid the rise in the cost of living over the past year.
In its announcement today of February’s inflation figures, the Office for National Statistics (ONS) shared the largest upward contributions to inflation came from housing and household services, mainly from electricity, gas, and other fuels.
Furthermore, there was a hike in the upward contributions from food and non-alcoholic beverages.
Prior to today, experts and economists had predicted that CPI inflation would fall to 9.9 percent.
The Bank of England has stated its target is to bring inflation down to two percent, with today’s announcement meaning it is more likely further intervention from the central bank is necessary.
This represents the first rise in UK inflation in the last four months and is bring the CPI rate closer to the record 41-year of 11.1 percent from October 2022.
In a bid to mitigate the impact of inflation, the Bank of England has raised interest rates ten consecutive times in the past year.
As it stands, the base rate is at four percent and the central bank’s Monetary Policy Committee (MPC) is due to meet tomorrow to discuss potentially hiking it once again.
With inflation rising after three previous months of dropping, another interest rate increase seems guaranteed.
In reaction to today’s news, Alastair Douglas, CEO of TotallyMoney,said: “Prices are still rising at a rapid rate, albeit a slightly slower one than we’ve become used to in recent months.
“At the same time, wages are on the slide, and when adjusted for inflation have fallen by 3.2 percent since November last year. Put simply, people are taking pay cuts.
“They’re borrowing money to plug this gap, and while last week’s Budget provides some respite — it doesn’t address the issue that nearly nine million adults are struggling to cover everyday essentials.
“Even if we do reach the Bank of England’s two percent inflation target by autumn, the problem isn’t going away.”
More to follow…
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