UK Inflation Hits Highest Levels In Almost Three Years
On Wednesday, the pound sterling climbed against the dollar as inflation in the UK rose to the highest levels in almost three years. Official figures suggest that the jump in UK inflation is due to increases in the price of food and motor fuel.
The Office for National Statistics said that the annual rate of inflation rose to 2.5% in June from 2.1% in May. June’s rate is the highest since August 2018, when inflation hit 2.7%. The jump has pushed inflation further above the Bank of England’s target of 2% and has provoked speculation that the UK’s central bank will need to respond soon to contain price pressures in the economy.
The UK is not alone in its increased rates of inflation. Several countries across the globe are currently experiencing steep increases in inflation as their economies recover from the coronavirus pandemic. On Tuesday, official figures revealed that the annual inflation in the US is running at its highest levels in 13 years. Around the world, central banks are hoping that the steep rise in inflation has been caused by temporary factors related to the pandemic, such as pent-up demand and supply pressures.