Inflation hits 30-year high

Inflation has jumped to a 30-year high, hitting 5.4%.

According to the Office for National Statistics, consumer prices index rose from 5.1% in November to 5.4% in December. Inflation has not been this high since it was 7.1% in March 1992.

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“What is of particular concern is that the change from November has come mainly from an increase in the price of food,” said Kitty Ussher, chief economist at the Institute of Directors.

“Not only does this provide additional evidence that inflation is becoming endemic rather than transitory, it also bodes ill for households facing multiple rises in the cost of living this spring.

“We therefore expect interest rates to rise again when the Bank of England monetary policy committee next meets in early February.”

Prices in food and furniture and household goods due to rising gas and electricity prices pushed up inflation.

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