Current Inflation rate for August 2010
CPI, the consumer price inflation has stayed above the Bank of England’s Target of 2 percent. The figure for the month of August was released this morning.
Rising Clothing costs, Air Fares and rising Food prices were factors that maintained the rate of inflation at 3.1%
It is anticipated that inflation will reduce over the coming months due to the Government’s spending review and a reduction in wage increases.
The Retail prices Index which measure inflation plus salary increases and mortgage costs stayed at 4.7%, down just 0.1% for the year.
Inflation is not falling as fast as predicted. Whether the Bank of England’s monetary policy committee will start to feel the pressure amidst mounting criticism we will have to wait and see.
Many economists believe that interest rates will stay low well into next year. At that point inflation will reduce and move back to the 2% target set by the Bank.
