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IoD press release Bank of England feeling the pressure on inflation

Commenting on today’s data from the Office of National Statistics that showed CPI inflation rose from 9.1% to 9.4% in June, Kitty Ussher, Chief Economist at the Institute of Directors, said:

“The headline inflation figure continues to be driven by the increased cost of household fuel and transport, combined with higher prices in the hospitality sector compared to a year ago.

“The latest monthly increase is primarily due to the rising price of petrol, with the average price of a litre rising by 18p in June. The last month has also seen a price rise in some detailed food categories notably dairy products, where prices had fallen a year ago.

“Much of the explanation for the inflation rate is international. But given that further rises in the headline rate are expected when the household energy cap is increased in the autumn, the Bank of England is nevertheless feeling the pressure to demonstrate it is doing everything within its power to tackle those components of inflation that are home-grown.”

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