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Staff of Reuters Read for 2 minutes (Reuters) – LONDON (Reuters) – As the economy recovered from coronavirus lockdowns, British inflation soared above the Bank of England’s target in June, hitting 2.5 percent, its highest level since August 2018 and up from 2.1 percent in May, according to official statistics released on Wednesday. PHOTO FROM THE FILE: People buy at market stalls in London, Britain, on January 15, 2021, with the City of London financial district skyscrapers in the background. Toby Melville/Reuters Inflation rose last month due to higher prices for food, petrol, used automobiles, apparel, and footwear, according to the Office for National Statistics. The figure was higher than all economists polled by Reuters, who predicted consumer price inflation (CPI) to touch 2.2 percent in the year ending in June. The Bank of England has predicted that inflation will rise above 3% as Britain recovers from its coronavirus lockdowns, but it also believes that the increase will be brief and that it will not need it to decrease its massive stimulus package for the British economy just yet. The ONS said that core inflation, which excludes food, energy, alcohol, and tobacco, was 2.3 percent in the 12 months to June, up from 2.0 percent in May. Last year, when most of the country’s economy was shut down and consumers were told to stay at home, inflation spiked. As the global economy improves, global oil prices have risen this year. In May, the CPI surpassed the Bank of England’s 2% objective for the first time in almost two years, but the increase is projected to be far less pronounced than in the United States. Consumer prices in the United States grew 5.4 percent in the 12 months to June, up from 5.0 percent in May, according to data released on Tuesday, and the Federal Reserve indicated last week that its top officials agreed they should be ready to intervene if inflation risks rise. The ONS reported on Wednesday that fuel prices in June were 20.3 percent higher than a year ago, the highest increase since May 2010. In the 12 months leading up to June, manufacturers’ input prices increased by 9.1%, while their output prices increased by 4.3 percent. David Milliken wrote the piece, while William Schomberg edited it./nRead More

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