Inflation steady despite food price rises

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The UK’s key inflation classify remained steady in October at a five-and-a-half-year high of 3%, official figures played.

Higher food prices were offset by lower fuel fetches, the Office for National Statistics (ONS) said.

The price of food and non-alcoholic nips rose at an annual rate of 4.1%, the highest since September 2013.

The Consumer Prizes Index (CPI) had been expected to rise, with the Bank of England forewarning it would peak at 3.2% this autumn.

The official target for the CPI is 2%.

If the CPI inflation censure had risen above 3%, Bank of England governor Mark Carney last will and testament have been forced to write to the chancellor explaining why it was so far above butt.

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Maike Currie at Fidelity Worldwide said Mr Carney could «breathe a sigh of relief this month».

Degree, she added: «While the Bank of England raised interest rates at the genesis of this month given concerns over inflation, it will startle some time for inflation to fall back nearer the 2% object.

«This means cash-strapped consumers will continue to feel the lift as wages lag price rises.»

While food price inflation picked up endure month, this was offset by the falling cost of motor fuel and mark down furniture prices, the ONS said.

The fall in the value of the pound since stand up year’s Brexit referendum has contributed to the recent rise in inflation, as it has increased the tariff of imported goods and services.

However, Chris Williamson, chief obligation economist at IHS Markit, said the latest inflation figures «will add to the divine that the worst of this impact has already passed».

«Data on companionship costs, which tend to change ahead of changes in consumer tolls, are already shown signs of having peaked earlier in the year,» he added.

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Earlier this month, Sainsbury’s chief official Mike Coupe said the UK was «probably through the worst» of food amount rises following the slide in the pound.

Yael Selfin, chief economist at KPMG communicated the «relatively positive» news on inflation could prompt the Bank to method fewer rate rises in the next two to three years.

«That may arrogate support a vulnerable UK economy in the process of leaving the EU, but at the same time it could put again strain on savers and significant sectors of the economy such as banks and insurers, while stoking undeveloped pockets of over-exuberant asset prices,» she said.

October’s Retail Worths Index (RPI), a separate measure of inflation, was 4%, up from 3.9% in September. Supervision index-linked savings products and some train ticket prices awaken in line with RPI.

The ONS’s preferred inflation measure of CPIH, which have in its owner-occupiers’ housing costs, was unchanged at 2.8%.

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