Inflation could rise to over 5%

The Bank of England’s new chief economist has said that UK inflation could go above 5% next year.

Huw Pill told The Financial Times: “I would not be shocked — let’s put it that way — if we see an inflation print close to or above 5%. And that’s a very uncomfortable place for a central bank with an inflation target of 2% to be.”

This September saw inflation dip to 3.1% – down from 3.2% in August. According to the Office for National Statistics, the rise in petrol prices and transport were the biggest contributors.

Mike Hardie, head of prices at the ONS, commented: “However, this was partially offset by most other categories, including price rises for furniture and household goods and food prices falling more slowly than this time last year.”

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“The costs of goods produced by factories rose again, with metals and machinery showing a notable price rise. Road freight costs for UK businesses also continued to rise across the summer.”

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