ONS reports record increase in inflation driven by food costs

ONS reports record increase in inflation driven by food costs

According to the latest report by the Office for National Statistics (ONS), the Consumer Prices Index measure of inflation hit 3.2% in August.

ONS has reported the biggest increase since records began in 1997, driven by higher food costs. The current rate now exceeds the Bank of England’s target of 2%, which was set “to keep prices steady.”

However, ONS has cautioned people from reading into the latest results as the organisation described the rise as “temporary”.

Jonathan Athow, deputy national statistician at the ONS, told the BBC: “August saw the largest rise in annual inflation month-on-month since the series was introduced almost a quarter of a century ago.

“However, much of this is likely to be temporary, as last year, restaurant and cafe prices fell substantially due to the Eat Out to Help Out scheme, while this year, prices rose.”

Speaking on BBC Radio 4’s Today Programme, Ruth Gregory, senior UK economist at Capital Economics said that the price increases were “almost unavoidable” because of the discounts available in 2020, such as the government’s Eat Out to Help Out scheme.”

She added: “Some of that rise reflected genuine factors too. In particular, we are now seeing the effects of higher global shipping costs and shortages of staff driving up food price inflation.”

Previous / Next posts...

Submit a Comment

Your email address will not be published. Required fields are marked *