Inflation spiked to 2.7%, a six month high, in August. The consumer price index was expected to rise at 2.4%. Wages are just growing, as wage growth is at 2.9%. The UK’s predicted real wage growth for 2018 is -0.7%. This means the average Brit will be earning less, in real terms, than he/she was at the start of the year.
The government has attempted to control inflation by raising interest rates.
The Retail Prices Index (RPI), a separate measure of inflation, was 3.5% in August, up from 3.2% in July.
Inflation is not historically high despite the worries about it.
Wages remain lower than they were in 2010 when the Conservatives took power, and whilst wages did drop slightly post economic crash the significant drop in real wages began in 2010 when austerity began.
Analysis from Iwan Doherty- Editor in Chief
A week pound due to Brexit uncertainity remains the cause of higher than normal inflation and whilst the drop in the growth of our labour force did help wage growth the average worker is still seeing wages barely expand in real terms. The average worker still earns less in real terms than he/she did in 2010 when the Conservatives.
The inflation is not historically high though and measures to increase wage growth are more vital.
It bemuses me that the population believe the Conservative government have an economic record than is anything but distrous. We are earning less than we were in 2010 due to austerity and the fiscal policies the Tories have caused. The act of draining the economy of spending is why workers remain so inpoverished post crash and why the UK has had the 2nd worst economic recovery in Europe.