Annual inflation surged to 5.1% in November, the highest rate for over a decade, official data showed on Wednesday.
The consumer price index, which increased from 4.2% in October, was above consensus expectations of 4.8% and the Bank of England’s forecast for 4.5%. It was the highest annual rate since September 2011.
A number of segments drove the hike, with motor fuel CPI surging to 28.5% from 21.5% after the price of crude oil jumped. Tobacco also rose, following an increase in duties in late October, while food CPI rose to 2.5% from 1.2% in October.
The price of second-hand cars rose, as did clothing CPI, increasing to 3.5% from -0.4% in October.
Including occupiers’ housing costs, CPIH rose by 4.6% in the 12 months to November, up from 3.8% a month previously and the highest since September 2008.
Core consumer price inflation, which strips out volatile elements such as energy, food and alcohol, also came in above estimates, rising to 4.0% from 3.4% in October, the highest since 1992. Most analysts were expecting core CPI of around 3.7%.
The BoE’s rate-setting Monetary Policy Committee is due to meet on Thursday. However, economists are still not expecting rates to rise.
Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said: “The quick ascent of CPI inflation over the last four months probably will not panic the MPC into raising interest rates this week, given that the full extent of the economic damage wrought by Omicron is still unknown.
“Looking ahead, the headline rate looks set to remain near November’s rate over the following four months, as the influence of a decline in motor fuel inflation, primarily due to base effects, will be offset by further increases in food and core goods inflation, linked to recent increases in producer prices.
“The headline rate then likely will soar to about 6.0% in April.”
