AND the bad news just keeps on coming. Yesterday’s record leap in inflation piled more financial misery on the nation – and most analysts believe there may not be an end to the current economic downturn until late next year.
The Consumer Prices Index (CPI) jumped to 4.4 per cent in July, the biggest month-on-month increase since the measure was introduced more than a decade ago. That means inflation now stands at more than double the Government’s target.
While we are light years away from the kind of inflation that bedevilled Britain in the Seventies, drilling down into the figures reveals worrying details. Food inflation last month stood at almost 14 per cent. Price rises announced in the last fortnight by the major energy companies are not included in yesterday’s figures – raising the spectre of inflation topping five per cent by the autumn.
The inflation figure means an imminent cut in interest rates is now unlikely, which further increases the pressure on hard-pressed homeowners.
It is undoubtedly a tough time for families. They need all the help they can get from the Government – and a cut in fuel duty, as we have advocated, would be a good start.
We don’t expect Mr Brown to be able to insulate the nation from the worldwide economic crisis – but we do expect him to take actions that are well within his powers to ease its impact. To date we have seen little evidence of such actions, other than postponing an unnecessary increase in fuel tax.
It is time for Mr Brown to deliver.
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