Newspaper article The Evening Standard (London, England)

Inflation Soars to Two-Year High as Brexit Fears Mount; Prices Rise 'Is First Real Evidence of Brexit Hitting People's Wallets'

Newspaper article The Evening Standard (London, England)

Inflation Soars to Two-Year High as Brexit Fears Mount; Prices Rise 'Is First Real Evidence of Brexit Hitting People's Wallets'

Article excerpt

Byline: Jonathan Prynn and Simon English

THE rate of inflation hit its highest level for almost two years today triggering warnings of a painful post-Brexit rise in the cost of living.

The Consumer Prices Index the official measure of inflation reached one per cent for the first time since November 2014, largely as a result of higher fuel prices.

Economists said last month's bigger than expected jump from 0.6 per cent was "the first real evidence of Brexit hitting people's wallets" as the rising cost of imports began to be passed on to shoppers. Some have forecast that inflation could reach three per cent by next year, far outstripping the rise in wages and savings returns and reducing living standards.

Statisticians said that a 1.2p rise in the average cost of a litre of petrol between August and September was a major factor in the increase in the cost of living. Diesel went up by 1.5p. It comes after Continued on Page 4 Continued from Page 1 the "Marmite-gate" row last week when Tesco refused to stock products made by the consumer goods giant Unilever after it tried to force through a 10 per cent rise in prices.

Oil prices have been steadily rising since they bottomed out earlier this year, but the impact on drivers has been magnified by sterling's slump as oil is priced in dollars on the world market. It now costs an extra PS5.50 to fill a typical 60-litre tank compared with six months ago.

A 5.2 per cent jump in the cost of clothing also contributed to the rise in inflation, although the Office for National Statistics said this could have been due to seasonal post-summer price increases rather than sterling's fall. Food prices actually fell slightly as a result of the continuing supermarket wars. The ONS's head of inflation, Mike Prestwood, said: "CPI inflation has risen to its highest for nearly two years, though it remains low by historic standards. …

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