Inflation also slowed in the UK: the November index rose by 0.4%, compared to 2% in October
| Gal Rekover, Devar News
Inflation is also slowing in the UK. Britain’s annual rate of change fell to 10.7% in November, down 0.4 percentage points from October, according to the British Office for National Statistics.
A decrease was also recorded in core inflation, which does not include food, energy and alcohol and tobacco products. From a rate of 6.5% in October to 6.3% in November.
On a monthly basis, it increased by 0.4%. This is the containment that is necessary for the British economy, after the prices jumped by 2% in October.
The most significant relief in the increase in prices came from the transportation section where, as in the US, small price increases were recorded compared to November last year. The critical brake came from the drop in used car prices, and stability in car fuel prices.
Additional slowdowns compared to November last year, which are the cause of the slowdown in inflation at the annual level, came from alcohol and tobacco products and clothing and footwear. Prices in restaurants and hotels continued to increase at an increasing rate, which reduced the moderation in the inflation rate.
Despite the containment, the rate of inflation in the Kingdom is still extremely high, 10.7%, causing general uncertainty and wage erosion that mainly affects the public sector. Wage erosion is the reason for the wave of strikes that the United Kingdom has been in for the past year, and is reaching its peak this week. The labor unions are demanding a wage increase, which would compensate for at least part of the erosion caused by the price increases.
The central bank is expected to continue raising interest rates, despite the poor performance of the British economy, which has suffered from particularly slow growth in recent years. Although growth in October, 0.5%, was a pleasant surprise, Finance Minister Jeremy Hunt echoed the widespread fears of a looming recession:
“The economy will probably deteriorate before it recovers.”
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