Top story
The UK’s food inflation hit 2% in November, the highest rate since April this year, according to the latest official figures.
It is the fourth consecutive month of year-on-year price hikes after after a low of 1.3% in August.
Alcohol and tobacco prices rose by 6.8% compared to the same month last year.
The Institute of Grocery Distribution (IGD) forecast last week that food inflation could go up to 4.9% next year, driven primarily by higher costs for businesses due to measures in the government’s budget.
“The rising cost of living, combined with increased employment and regulatory costs, will keep inflation elevated,” said James Walton, IGD’s chief economist.
The UK’s overall inflation rate hit 2.6% in November with motor fuel and clothing among the main drivers, up from 2.3% the previous month.
The average price of petrol rose by 0.8p a litre between October and November 2024 to stand at 134.8p a litre, while the price of diesel rose by 1.4p a litre to 140.5p
The Bank of England’s monetary policy committee meets tomorrow to set interest rates and is widely expected to keep them unchanged at 4.75%.
Andrew Bailey, the Bank’s governor, has said that how businesses react to the government increasing the rate of employer national insurance contributions in the autumn budget is the “biggest issue” facing the economy.
Morning update:
Brexit has hit UK trade less than predicted due to the adaption of larger companies at the border, according to research by the London School of Economics.
The report concluded that while the trade deal signed in 2020 “undoubtedly decreased trade”, the decline was “at least in the short run, smaller than forecasters expected”.
Thomas Sampson, co-author and associate professor of economics at LSE, said while the trade deal “has been a disaster for small exporters…larger firms have adapted well to the new trade barriers”.
About 14% of firms that previously exported to the EU - around 16,400 in total - stopped doing so after the trade deal came into force in January 2021, said the report by economists at the Centre for Economic Performance.
The research is the first to study the impact of Brexit on trade using customs records collected by HMRC.
No comments yet