Inflation has stagnated at 8.7 per cent, the same rate as three months ago, causing businesses and consumers concern amid hopes of a decline, since the UK has been on a downward trend in inflation figures which peaked at 11.1 per cent last year.
Prime Minister Rishi Sunak pledges to halve inflation this year, statistics shows that “Core” inflation, which impacts upon energy and food costs, is at the highest rate since 1992, as UK debt is being flagged as higher than annual GDP for the first time since 1961.
The Office for National Statistics offered insight, highlighting that the prices for air travel as well as recreational and cultural goods contributed to keeping inflation high, while falling prices for motor fuel provided the most help towards the downward trend.
The chancellor, Jeremy Hunt argues spending constraints are needed to help control inflation, which means continuing to resist the tax cuts some Conservatives are pushing for.
Khalid Talukder, Co-Founder of DKK Partners said, “While inflation stagnating may cause concerns across the nation, the economic outlook is still a lot brighter than at the back end of last year and businesses across the country should remain confident that better times are ahead.
“The government has its sight set on growth, removing barriers for businesses, and opening up opportunities for international trade, which should offer hope to SMEs who are looking to get back out into the marketplace and resume business as usual.”
“Morale should remain high as the economy rebuilds itself. Vital sectors such as the financial services and FinTech industries hold huge global presence offering services that enables international trade, faster payments, and FX services to companies seeking to boost productivity.
“These key industries will attract global investment and new business opportunities, shining a light on the potential of the nation and businesses should remain optimistic towards the future of the UK economy.”
The Chancellor said, “We know how much high inflation hurts families and businesses across the country, and our plan to halve the rate this year is the best way we can keep costs and interest rates down.
“We will not hesitate in our resolve to support the Bank of England as it seeks to squeeze inflation out of our economy, while also providing targeted support with the cost of living.”