Surging input costs have resulted in the highest rate of output price inflation in 16 years, according to Office for National Statistics (ONS) figures.
Annual output price inflation for January showed an increase of 5 per cent from December – reaching a total of 5.7 per cent – while raw material costs raced up by a massive 18.7 per cent in the 12 months to the end of January.
“The January producer price inflation is really horrible and will likely send blood pressures higher at the Bank of England,” remarked Global Insight’s UK economist, Howard Archer. “[They] further limit the scope of the Bank to cut interest rates aggressively to try and reduce the danger of a sharp economic downturn over the coming months.”
