U.K. inflation rates hit record high and are not signaling a slow down anytime soon.
Key Details
- The U.K. has been suffering from record high inflation—hitting the highest point in 41 years.
- High energy and food prices in the U.K. have pushed inflation to the highest point since 1981 and there is no signal for a potential slow down coming soon.
- Consumer prices rose 11.1% in October compared to the year before jumping from the 10.1% increase in September, according to the Office for National Statistics (ONS).
Why it’s news
Much like America, the U.K. has been suffering from record high inflation rates, but in the U.K. there have been no signs that the high inflation rate will come down anytime soon.
In an effort to control price growth, Finance Minister Jeremy Hunt announced tax hikes and spending cuts that will be put in place that, he says, are “tough but necessary” and will be announced later this week.
“It is our duty to help the Bank of England in their mission to return inflation to target by acting responsibly with the nation’s finances,” says Hunt.
This is the U.K.’s longest recession on record, according to the Bank of England. Both the government and the bank have been working together to put a stop to the continuously growing inflation rates.
The BOE raised interest rates by 75 basis points earlier this month, its largest hike in over 30 years, to take the Bank Rate to 3%, but challenged the market’s pricing of future rate increases, according to CNBC writer Elliot Smith.
The continuously high inflation rates in the U.K. are different from those in America as the U.S. is slowly but surely looking to finally overcome the inflation prices that have plagued the country over the last few months.
