UK Inflation Rate in November Hits 5.1%... Highest in 10 Years

Bank of England Expected to Keep Base Rate Steady Amid Omicron Variant Impact

[Image source=Yonhap News]

[Asia Economy Reporter Ki Ha-young] The consumer price inflation rate in the UK for November reached its highest level in over a decade.

On the 15th (local time), the UK Office for National Statistics announced that the November consumer price inflation rate rose to 5.1%, nearly 1% higher than the previous month (4.2%). This is the highest since September 2011, when oil prices surged and inflationary pressures were significant, and it also exceeded expert forecasts (4.7%). Previously, the Bank of England had projected the inflation rate to surpass 5% by next spring.

Inflationary pressures appeared across various sectors, from goods to services. The Office for National Statistics explained that prices for petroleum, clothing, and footwear rose sharply. Oil prices are at record highs, and used car prices also increased significantly.

The core inflation rate, which shows the underlying trend of inflation, rose to 4.0%, up considerably from 3.4% the previous month. This is the highest since 1992.

Meanwhile, the Bank of England is set to decide on the base interest rate on the 16th. The financial market expects the timing of interest rate hikes to be brought forward due to the recent sharp rise in inflation, with some anticipating an increase as early as last month, but the Bank of England has not moved yet. The new COVID-19 variant, Omicron, remains a variable.

Joel Selbin, an economist at KPMG, said, "It seems likely that the Bank of England will hold rates steady again this time and observe the impact of the Omicron variant on growth and inflation."

Meanwhile, the International Monetary Fund (IMF) urged the Bank of England to take action, forecasting that the UK inflation rate will rise to 5.5% in the second quarter of next year, marking the highest level in 30 years.

This content was produced with the assistance of AI translation services.