Tuesday, October 18, 2011
Inflation hits 5.2% - is it the peak?
Posted by David Smith at 09:35 AM
Category: Thoughts and responses

The bald headlines for inflation are bad, and there is not a lot of comfort in the detail. With the unemployment rate at its highest for 15 years (17 in actual numbers unemployed), this may be a good time to revisit the misery index: unemployment plus inflation.

So, on inflation: CPI annual inflation stands at 5.2% in September 2011. CPI annual inflation has never been higher but was also 5.2% in September 2008

RPI annual inflation stands at 5.6% in September 2011, the highest it has been for over 20 years. The last time RPI annual inflation was higher was in June 1991 when it stood at 5.8%.

All I can say is that the Bank of England must have been desperately worried about growth, and very confident inflation will fall sharply to have launched another 75 billion of quantititive easing in this context. More here.