Cost of living higher as rate of inflation hits 3.3%
The official rate of inflation jumped to 3.3% in May, way above Aprils level of 3% and has prompted Bank of England Governor Mervyn king to write to Chancellor Alistair Darling explaining why the rate, which measures the cost of living, exceeds the Governments 2% target. This is only the second time the Bank of England has had to write such a letter, the last time being in March 2007 when the cost of living topped the 3% mark.Mr King warned that there are further increases to come and the rate would tip over 4% by the end of 2008 with uncertainty about when this figure is likely to come down.
Oil and food prices are amongst the biggest rises in the Consumer Price Index (CPI) which is an index number measuring the average price of consumer goods and services purchased by households. Percentage changes in the CPI is a measure of inflation.
Inflation has been on a steady climb since August 2007 and jumped half a percent in April 2008 which is the biggest rise for about 6 years.
