Inflation remains above-target
By politics.co.uk staff
The rate of inflation measured by the Consumer Price Index (CPI) has remained steady at 3.1%.
The figures released today by the Office of National Statistics (ONS) paint a mixed picture for Britain’s economic forecasts.
The Bank of England has set a target of 2% inflation maintained by sticking to extremely low interest rates of 0.5%.
This is the tenth month in a row that the CPI inflation figure has remained above-target.
The ONS report suggests no uniform trend for the influences on inflation, with some sectors’ prices rising steadily, while others, such as airline fares, collapsing in September.
Meanwhile, the Retail Price Index figure fell by 0.1% to 4.6% between August and September.
Retailers have already warned that this may have a problematic impact on business rates which are calculated based on the RPI – potentially leading to greater redundancies as companies struggle to maintain their balance sheets.
The government’s hopes hang on a strong private sector recovery following the pain of the spending review.
Today’s figures again raise the spectre that the government may be forced into another round of ‘quantitative easing’ -printing money – to lubricate the economy.