U.K. inflation accelerated more than expected in July to the highest level in 40 years, intensifying a squeeze on consumers and adding to pressure for action from the government and Bank of England.
The reading was higher than expected by the Bank of England and private-sector economists. Economists' forecasts in a Reuters poll for inflation were to rise to 9.8% in July.
Rising food prices contributed the most to the month's increase, indicating inflationary pressures are spreading beyond energy.
Core inflation -- excluding energy, food, alcohol, and tobacco -- accelerated to 6.2%, increasing from 5.8% in June.
The Bank of England earlier this month raised its key interest rate by 0.5% to 1.75% - its first half-point rise since 1995. Its forecast inflation would peak at 13.3% in October, writes Reuters.
Data from the Office for National Statistics showed that prices rose 0.6% in July from June on a non-seasonally adjusted basis. The annual rate of retail price inflation hit 12.3%, its highest since March 1981.
UK inflation out of control: CPI 10.1% Y/Y, EST. 9.8%. Up 9.4% in June. pic.twitter.com/G88h3Lw9L4— Benzinga (@Benzinga) August 17, 2022
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.