Blog
Highest inflation for 16 years - but no panic!
14th October 2008
The annual rate of CPI inflation jumped to 5.2% in October - the highest inflation number since the UK was last in recession in 1992. Yet remarkably the response was muted. Much of the climb in the cost of living was attributed to the steep increases in utility bills compared to this time last year. Indeed the consensus is that consumer price inflation will move lower in the months ahead as oil prices fall, food prices move down from their peak, petrol and diesel prices dip on the forecourt and the there is some reversal in utility bills.
And in a recession the power of workers to bid for inflation-busting pay rises is severely constrained.
I have put together a ten chart presentation on the UK inflation numbers in case colleagues teaching inflation want to use some bang up to date charts. This Guardian interactive graphic is also recommended.
Chart presentation High_UK_Inflation.ppt
Geoff Riley
Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.