UK Inflation: the only way is up, baby

With Consumer Prices Index (CPI) rising to 3.3% (year on year to May-08), the fastest rate of increase in over a decade, the Governor of the Bank of England has written to the Chancellor to explain.

…What can we learn from this exchange?



Starting with King. He reviews the situation noting that inflation has recently risen sharply from 2.1% in December to 3.3% in May. The increase driven almost entirely by the increased price of food, fuel, gas and electricity.

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