More Brexit woes?
A leading think tank has forecast that the second half of next year will see inflation rise by 4 per cent and will cut disposable income.
During 2017 the rate of the pound is expected to fall drastically which will affect consumers.
The figure has since risen from its original forecast in August of three per cent.
The economy could see a huge impact which will mean it will struggle to grow any further.
The Office for National Statistics (ONS) found last month that the Consumer Price Index (CPI) rose from 1 per cent in September, this is up by 0.6 per cent in August.
This has been the highest rate in nearly two years as prices of products climbed such as the cost of; petrol, clothes and hotel rooms.
We are expected to see further adjustments to these forecasts when the Bank of England proceeds to it quarterly Inflation Report on Thursday.
The pound has continued to fall since the Brexit vote, the National Institute Of Economic and Social Research (NIESR) is expecting to see the sterling stay the same throughout 2017.
Simon Kirby, head of macroeconomic modelling and forecasting at NIESR, told the BBC: “This will pass through into consumer prices over the coming months and quarters,” he said. “While we expect this to be only a temporary phenomenon, it will nonetheless weigh on the purchasing power of consumers over the next couple of years.”
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