Inflation surges to 4.4% – is it time for a change at the Bank of England?

22nd March 2011

This morning the Office for National Statistics has reported that the Consumer Price Index – the Government's measure of inflation –  grew to 4.4 per cent in February, up from 4 per cent in January.

In the year to February, RPI annual inflation was 5.5 per cent, up from 5.1 per cent in January.

RPIX inflation – the all items RPI excluding mortgage interest payments – was also 5.5 per cent in February, up from 5.1 per cent in January.

Why did inflation rise again this month?

The main causes of this months surge in inflation were as follows.

Domestic heating costs, clothing and footwear where there was a record January to February movement, the miscellaneous section, and recreation and culture.

Regular readers will be aware that clothing and footwear has been a source of inflation for a while partly driven by the rise of cotton prices.

Also whilst there may be no surprise at the rise in domestic heating costs many will wonder when the impact of the general rise in fuel bills will hit as we know that petrol and diesel prices have been rising consistently.

There was one category which reduced prices so step forward alcoholic beverages and tobacco, you country needs you!

Read on…

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