The Office for National Statistics calculated that the CPI measure remained at an annual rate of 2.7% in November 2012.
With high food prices as a result of a poor harvest contribute to stubborn inflation in the run up to Christmas, the main rate of inflation remained unchanged for November. We had falling petrol prices but this failed to offset rises in many basic food items and home energy pricing.
Many had expected the figure to decrease slightly ahead of increases in the rate next month as the rises that are expected for household energy bills. The first increase was by energy supplier SSE whose figures were included within the November statistics. But with expected increases by other energy providers set to come into force, analysts think inflation will peak at 3.5% by mid-2013.
Upward pressure from gas and electricity prices pushed housing and household services inflation up by 0.6%, the ONS said, while increases in the price of fruit, bread and cereals also added pressure to the CPI rate. But a fall in the cost of transport was the biggest factor which kept the rate steady as petrol prices fell by 3p to £1.35 per litre on average while diesel dropped 1.5p to £1.42.
The RPI measure of inflation, which includes housing costs, fell to 3% in November from 3.2% in October as transport costs and mortgage interest payments fell.
In its quarterly forecasts revealed last month, the Bank of England expected inflation to remain significantly higher over the next 18 months that it had previously expected.
It was that factor which is thought to have prevented the bank adding to its bond purchase programme, known as quantitative easing, to boost money supply in the UK economy despite evidence of continuing sluggish growth.
Commenting on the figures, the TUC general secretary Brendan Barber said: “The stubbornness of inflation, combined with poor wage growth, is putting real pressure on people’s finances in the run up to Christmas. With the Office for Budget Responsibility not expecting real wage growth until 2014 and further cuts to in-work benefits due this April, 2013 looks like being another tough a year for working families”.
Reference Source: SkyNews.com