UK Inflation Accelerates to Nine-Year High in August

Source: Office for National Statistics

Inflation in the United Kingdom accelerated by a record-high in August, bringing the latest reading to the fastest in nine years.

• The Consumer Price Index (CPI) climbed by 3.2% in July, the fastest in nine years since the 3.5 print recorded in March 2012.
• The latest reading is 1.2 percentage points higher than the 2.0% in July, the biggest increase on record since data collection started in January 1997.
• On a monthly basis, the CPI increased 0.7%. Monthly inflation was flat in July and -0.4% in August.
• The Consumer Prices Index including owner occupier’s housing costs jumped 3.0%, up from the 2.1% in July. The 0.9-percentage point increase is also series high.
• The biggest upward contribution was the base effect, as restaurants and cafe prices were discounted in August 2020 amid tax reductions and government assistance.
• Upward movements were seen in hotels, housing and household services, and recreation and culture.