October 5, 2022
UK inflation falls below 10% as petrol prices drop

Britain’s inflation rate returned to single digits in August due to low petrol prices, providing some respite for families in the winter.

The headline consumer price index was up 9.9 per cent during the month from a year ago, down from a 40-year high of 10.1 per cent in July.

Following Prime Minister Liz Truss’s announcement that the government would protect households from an 80 percent increase in gas prices in October, economists now expect inflation to hover around the 10 percent level through the fall, not just will exceed 15 percent. ,

But an injection of perhaps around £150bn into the economy to support subsidized homes and businesses for gas and electricity is likely to keep inflation in check over the long term, increasing pressure on the Bank of England to raise interest rates further. Is.

Economists expect a 0.5 percent increase when the bank’s monetary policy committee meets next week, with its official interest rate expected to rise from 1.75 percent to at least 3 percent by the end of the year.

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