Fuel and food prices have pushed Bank of England’s 2% target
The Office for National Statistics (ONS) states an increase in inflation
by Abi Moses on 22nd March, 2017 and updated 22nd March, 2017 4:10pm
Due to the rise in fuel and food prices, The Office for National Statistics (ONS) have stated that the measure of inflation reached 2.3% in February which compares with 1.8% in January.
The growth will certainly put a huge pressure on the Bank’s Monetary Policy Committee (MPS) to lift interest rates above 0.25% by the end of 2017.
The statistics above come following the switch over from ONS’ measure of inclination, to Consumer Prices Index which also holds housing costs (CPIH). These costs are closely associated with living, owning and maintaining a home.
Jonathan Athow, ONS Deputy of national statistician has said: “Inflation has risen to its highest rate for almost three-and-a-half years with price increases seen across a range of items but with food and fuel having the largest impact."
The price of food has risen by 0.3% since February 2016, which was revealed following supermarket prices being hidden. This is down to the staggering import costs which have been implicated by the EU referendum result.
ONS have stated that iceberg lettuce prices have plummeted a staggering 67.2% between January and February. Furthermore, there has also been an inflation of transport costs. Since February, motor fuels have risen 1.2%.
On the other hand, retail prices, which concern different measures of inclination did rise to 3.2% in February.
The Bank of England have stated they will continue to use CBI in order to set interest rates in the near future.
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