Surprise increase in inflation to 4%, latest figures show
The annual rate of price rises has surprisingly risen, official figures show.
The consumer price index (CPI) measure of inflation stood at 4% in the year to December, according to the Office for National Statistics (ONS). A fall, to 3.8% had been expected by economists polled by Reuters.
It’s a rise from 3.9% in the year to November.
It comes as a number of chain retailers put more items on sale earlier. Industry data showed a third of all in spending in the weeks up to Christmas was on items with some kind of offer.
Similarly, the pace of wage rises has slowed. Official figures published on Tuesday recorded that pay packets were growing at a reduced annual rate than previously – 6.6% compared to 7.3% a month earlier.
Today’s inflation data will be scrutinised by the interest rate setters in the Bank of England, who raised the base interest rate 14 consecutive times to 5.25%, making lending more expensive, in an effort to bring down price rises.
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