High inflation hits UK economy by £10bn, report finds

It's latest Item Club report said inflation had averaged 3.5% - well above the government's target of 2%. It added high inflation would "remain a permanent fixture" in the UK and it is not likely to fall below 2.5% before 2017, the BBC reports. Inflation at this rate has had a "corrosive impact on the UK economy", according to E&Y. Food prices have risen 40% since 2007 and consumers are also struggling with rising fuel and education costs, the report said. However, Item Club senior economic adviser Carol Astorri said it could have been worse. "Our modelling shows the [Bank of Englan...