Inflation fears are fuelled as headline CPI rate records biggest monthly surge EVER to 3.2% in August – but experts say Rishi’s Eat Out scheme last summer has warped figures
Inflation fears were fuelled today as the headline CPI rate recorded its largest jump ever in August to 3.2 per cent.
The consumer prices index rose above the expectations of analysts to reach its highest level for more than nine years.
The rate is far above the 2 per cent target set by the Bank of England, which has insisted the spike will be temporary.
Experts have pointed to the warping effects of Rishi Sunak’s Eat Out to Help Out scheme, which slashed prices last summer.
But it again raises the spectre of prices running out of control in the wake of the pandemic.
The consumer prices index rose above the expectations of analysts to reach its highest level for more than nine years
The Office for National Statistics (ONS) said CPI jumped from 2 per cent in July to 3.2 per cent in August, the highest since March 2012 and the biggest monthly increase since records began in 1997.
The ONS said apart from the Treasury-funded discounts last summer there was also likely to have been some impact from the supply chain crisis on inflation last month, which it said helped push up food and non-alcoholic drinks prices.
Jonathan Athow, deputy national statistician at the ONS, said: ‘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.
‘Food and non-alcoholic drink prices rose by more than last year, which also helped push up the rate.’
Shadow Chief Secretary to the Treasury Bridget Phillipson said: ‘People are already feeling the effects of inflation, in their weekly shop and at the petrol pump.
‘The Government must do all it can to secure the supply chains that keep our economy going, and shouldn’t be hitting families with a devastating cut to Universal Credit and tax rises.’
Experts have pointed to the warping effects of Rishi Sunak’s Eat Out to Help Out scheme, which slashed prices last summer