Royal Bank Profit Trails Estimates As Rates Pressure Margins

Consumer Price Index inflation up by more than expected to 5.4% in December 

  • ONS says inflation rate is now at its highest since March 1992 when it was 7.1% 

  • Rise was above economists' forecast of 5.2% and up from the 5.1% in November

  • Latest government figures show average 10% price growth in November 2021 

  • Cost of £200,000 mortgage could rise by £1,200 a year if interest rates hit 1%

  • Pensioners will be particularly hard hit, due to the scrapping of the triple lock  

  • By Mark Duell for MailOnline

    Published: | Updated:

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    The rate of Consumer Price Index inflation in Britain has increased by more than expected to 5.4 per cent - its highest rate in 30 years, official data revealed today.

    The Office for National Statistics said December's figure was up from 5.1 per cent in November, and is the highest since 1992 as the cost of living squeeze continues.

    Economists polled by Reuters had forecast that the rate would get to 5.2 per cent in December - so the official reading was 0.2 percentage points above estimates.

    Household finances are under pressure as gas and electricity tariffs have also seen major rises and supply chain problems are pushing up costs across the economy. 

    Pensioners will be particularly hard hit, with the scrapping of the triple lock meaning a planned 8.3 per cent increase will now only be a 3.1 per cent boost, just as the cost of essential goods surges more than 6 per cent. 

    It comes after separate data yesterday revealed that wage growth was outstripped by inflation in November 2021 in more than a year - for the first time since July 2020. 

    New official figures showed house prices by £25,000 last year and continued to climb even after the end of the stamp duty holiday. 

    Meanwhile, the cost of £200,000 mortgage could rise by £1,200 a year if interest rates rise to one per cent.  

    Unions have stepped up campaigns for pay rises following the latest inflation figures amid warnings of a 'cost-of-living catastrophe' for workers.  

    An ONS graph of the Consumer Prices Index including owner occupiers' housing costs (CPIH), the Consumer Prices Index (CPI) and the owner occupiers' housing costs (OOH) component

    An ONS graph of the Consumer Prices Index including owner occupiers' housing costs (CPIH), the Consumer Prices Index (CPI) and the owner occupiers' housing costs (OOH) component

    Inflation is now at historic highs. Pictured: Graph showing inflation from 1992 up to the current date, based on ONS data

    Inflation is now at historic highs. Pictured: Graph showing inflation from 1992 up to the current date, based on ONS data  

    The inflation rate adds pressure on the Bank of England to raise interest rates again next month

    The inflation rate adds pressure on the Bank of England to raise interest rates again next month

    The ONS said the price of goods produced by UK factories was up 9.3 per cent in the year to December - slightly down from the 9.4 per cent rise in the year to November.

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    Source : https://www.dailymail.co.uk/news/article-10417435/Inflation-soars-highest-rate-THREE-DECADES.html

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