Britain's inflation more than doubled in April.

[kafa88]

The UK's annual inflation more than doubled in April as rising energy and clothing costs led to higher prices.The increase to 1.5% in April from 0.7% in March means consumer prices will rise at the fastest rate since March 2020 at the start of the outbreak.The rapid increase largely reflected a price increase from last year's low at the start of the outbreak, the National Statistical Office Higher oil prices have also resulted in higher oil prices.According to ONS, inflation has soared as blocking restrictions have eased and stores will reopen on April 12.The increase in clothing and shoe prices goes against an unusual drop in the month.

February While gas and slotxo electricity prices rose sharply after the initial tariffs increased compared to the previous year's drop.Hannah Adino, an economist at PwC, said she expected inflation to continue to rise as blocking restrictions eased and the economy remained operational again. "Allows the consumer to release some excess savings.Evidence of a recent survey suggests that the share of households planning to spend on savings has increased in recent months as the introduction of the vaccine boosts confidence," she added.Economists have forecast inflation to rise in April. But there are concerns that rising inflation this year as the global economy recovering from the pandemic could push the central bank to raise interest rates.


What is inflation?

Inflation is the rate at which prices of goods and services increase.It is one of the key measures of financial well-being as it affects what consumers can buy with their money. If there is inflation, the money doesn't go far.Expressed as a percentage of the price increase or decrease over time. For example, if the inflation rate for 1 liter of petrol is 2% per year, the driver's spending at the pump increased 2% over the previous 12 months.And if wages do not rise with inflation, purchasing power and living standards drop.However, small inflation often encourages people to shop faster and makes it easier for companies to pay wages. And both of these things have helped stimulate economic growth.That's why most central banks have an inflation target of between 2% and 2.5%.In the UK, the government has set the Bank of England inflation target at 2%.


'Bottleneck'

Earlier in May, fears that rising inflation in the United States will hurt financial markets after consumer prices hit their highest yearly since 2008.High government spending on the Covid support program, coupled with consumer savings, led to higher prices, experts said.Liz Martins, senior economist at HSBC, said it appears Britain's inflation rate is higher than the Bank of England's 2 percent target, although this is. "It shouldn't be too much of a concern for the bank.Their view is that they need to maintain sustained inflation around 2% over the next two to three years, so the short-term expansion won't worry them too much if it is just temporary - and That's where opinions really seem to differ.

Several central bank governors, especially in the United States, said the increase was due to the bottlenecks in the aftermath of the epidemic, which will be eliminated, Ms Martins said.But some, including Bank of England chief economist Andy Haldane, said higher prices could slow a rebound and banks may need to raise interest rates to cool things down.Laith Khalaf, a financial analyst at AJ Bell, said the price increase was "In the areas where consumers are difficult to control their spending, such as the transportation of clothing and household energy"At current levels, inflation is not a concern. But there is growing concern that fiscal and monetary responses to the pandemic have sowed the seeds of inflation fears further, ”he said.

He said the Bank of England had made it clear that it would tolerate inflation above its 2% target without having to "pull the trigger" when interest rates rise.However, if inflation seems to be gaining a significant foothold, markets will operate themselves and increase borrowing costs across the economy,Two weeks ago, the Bank of England said Britain's inflation was above its 2% target and was expected to hit 2.5% by the end of 2021.That was due to the rising global oil prices and the end of COVID in September of cuts to the value-added tax (VAT) on the services sector, as well as the decline in the epidemic. 2020 year The bank thinks inflation will fall to 2 percent in 2022 and 2023.Bank of England Governor Andrew Bailey said Tuesday that so far there has been no clear evidence of rising prices from producers paying consumer prices.