Inflation SOARS to highest level this year in blow to Labour ahead of Budget
INFLATION has hit the highest level this year just days ahead of Chancellor John Healey’s first Budget.
TL;DR
- Inflation has risen to 3.5% in the 12 months to September.
- This is higher than economists predicted and is a blow to the government's cost of living pledges.
- The Bank of England's target for inflation is 2%.
- Higher inflation may lead the Bank of England to increase its base rate, resulting in rising interest rates.
- The state pension increase will be based on the September inflation figure, which is good news for pensioners.
- Transport costs, including petrol and diesel prices, are a significant factor in the inflation increase.
- Energy prices are also predicted to rise significantly, with average bills potentially reaching £2,153.75.
- Rising inflation means a lower spending power for households.