The UK’s CPI annual inflation continues to grow past 2% target
The Consumer Price Index (CPI) annual inflation – the Government’s target measure for inflation – reached 3.7 percent in April, according to the Office of National Statistics.
This was a 0.3 percent rise on March’s figure of 3.4 percent and significantly higher than the UK target of 2 percent. The greatest upward growth occurred in clothing and footwear, where prices rose 2.2 percent between March and April, in comparison to only 0.2 percent the previous year.
The rise in CPI was reflected by the Retail Price Index (RPI) annual inflation, which in the year to April was 5.3 percent, the highest since 1991 and up 4.4 percent from March.
Bank of England governor Mervyn King blamed the rising fuel costs and tax rises on alcohol, introduced in March’s budget, for the growth. He also pointed to the inflationary impact of the weaker pound, and argued that prices were lower in 2009 because of the temporary cut in VAT.
"The change in VAT and higher petrol prices will continue to be reflected in the overall price level. But, unless they increase further, that should affect the twelve-month CPI measure of inflation for no more than a year," King wrote in a letter to George Osbourne, as reported in The Guardian.
Internationally, the CPI shows the UK inflation rate in March was significantly higher than the provisional figure for the European Union of 1.9 percent.