British inflation rises to 4.2%, beating expectations

People were seen eating out in Sohoo in London in September 2021. Since Covid restrictions were lifted in the UK, people have flocked back to streets, shops and public spaces.

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The cost of living in the UK rose in October, with the figure now more than double the target set by the Bank of England.

The UK Consumer Price Index rose 4.2% in the 12 months to October 2021, up from 3.1% in September. Economists surveyed by Reuters had an expected figure of 3.9%.

The Bank of England held steady interest rates earlier this month, defying the expectations of many investors that it will become the first major central bank to raise rates after the coronavirus pandemic. The Bank has monitored a convergence of crucial data points, as inflation remains consistently high as economic growth moderates and working conditions tighten.

The Bank of England now expects inflation to rise to around 5% in the spring of 2022 before falling back to its 2% target by the end of 2023 as the impact of higher oil and gas prices fades and commodity demand moderates.

Eurozone

Eurozone inflation hit a new 13-year high in October, at 4.1%, as the currency bloc struggles with rising energy costs.

This was the highest level since July 2008, according to Reuters data, and was ahead of a consensus forecast of 3.7%. The September figure came in at 3.4%.

– CNBC’s Elliot Smith contributed to this article.

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