The consumer price index in the UK continues to rise in January. The CPI rose by 5.5% year-on-year, up from 5.4% in December 2021. Inflation thus rises to its highest level since March 1992.
Month-on-month, the CPI fell by 0.1 percent
The main drivers of the rise in inflation were increasing prices in clothing, housing, and furniture.
Suren Thiru, head of economics at the British Chambers of Commerce commented, “Rising inflation highlights both the cost-of-living crisis facing households and the uphill struggle for businesses to keep a lid on price rises amid surging cost pressures,” adding, “While the headline annual figure remains at a 30-year high, the decline in monthly inflation in January offers some hope that we may be nearing the peak in the current spike in inflation.”
Meanwhile, the Bank of England warns that inflation could possibly rise even further this year. Although the BoE has already raised interest rates twice to 0.5%, the BoE forecasts an increase of 7.25% in April. That would be the highest increase since 1991.