The U.K.’s consumer prices index jumped by 3.2% in the 12 months to August, the largest ever month-on-month increase since records started in 1997.
Source: Office for National Statistics.
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The Office for National Statistics noted that the surge was “likely to be a temporary change” and the UK government’s “Eat Out to Help Out” program last year may have contributed to the jump.
ONS further added that the government’s Eat Out to Help Out (EOHO) program was a short-term scheme, noting that the upward shift in August is likely temporary.
The CPI increased 0.7% in August 2021, compared with a drop of 0.4% in August 2020 on a month-on-month basis.
The reading is against higher than Bank of England’s target of 2% and will add weight to these calling for an end to unprecedented pandemic-era stimulus policies.
The restaurants and hotels, recreation and culture, and food and non-alcoholic beverages accounted for the largest upward contributions to the change in the CPIH 12-month inflation rate between July and August 2021.