Is inflation rising or isn't it? The question highlights an increasing split between the government view of prices and what the Bank of England sees in relation to the ‘old' measure of inflation, the retail price index.
Figures released today by the Office for National Statistics show RPI jumped again in March to an annualised rate of 2.6% from 2.5% in February as recent rises in interest rates started to bite, pushing up overall inflation including mortgage payments. Evidence of this effect comes from the RPIX index, which excludes mortgage payments, which shows inflation fell in March to a level of 2.1% from 2.3% in the previous month. ”The largest upward effect on the RPI annual rate came from housing,” the ONS says. ”Mortgage interest payments rose this year as lenders passed on mostof this Fe...
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