On the way up and up

Today's inflation figures make stark reading.The government's official CPI measurte is at 3,8% up 0.5% from last month.
The expected figure was 3.6% and this will mean that the forseen target of 4% is going to be broken a lot quicker than the MPC thought.

National Statistics tell us that

The average price of petrol increased by 5.3 pence per litre between May and June this year, to stand at 117.6 pence, compared with a rise of 1.3 pence over the same period last year. There was a small effect from air transport where prices rose by more than last year

and

The largest upward pressure came from food and non-alcoholic beverages. There were also large effects from meat, fruit and bread and cereals.

Both of which will immediately hit the pocket of the downtroden consumer.

The RPI which includes housing costs now stands at 4.6%,up 0.3% from May.

Fraser Nelson over at Coffee House reminds us that

one of the biggest factors behind this is sterling’s loss of value – 13 percent against a trade-weighted index - which is of the same magnitude as on Black Wednesday. When your currency crashes like that, of course, you’ll notice it at the supermarket checkout.

Meanwhile the government continues to pump out the same old story.The Chancellor tells the BBC that

the UK economy was fundamentally strong, as long as inflationary pay rises were resisted in the economy.