UK Inflation rise shows risks to more Bank easing
Inflation ticked up last month and appears on track to hit 5 percent later this year, further squeezing cash-strapped Britons and posing a major obstacle to any moves by the Bank of England to give the economy an extra boost.
As an internationally comparable measure of inflation, the CPI shows that the UK inflation rate in June was above the provisional figure for the European Union. The UK rate was 4.2 per cent whereas the EU’s as a whole was 3.1 per cent.
The next publication date is 13 September 2011.
Bank of England governor Mervyn King blamed the continuing high inflation rate on, "the increase in the standard rate of VAT to 20%, and past increases in global energy prices and import prices".
He also stressed that "the big risks currently facing the UK economy come from the rest of the world".