UK consumer prices jumps in September

UK consumer prices expended at the fastest annual pace in nearly two years during the previous month, the biggest monthly increase in the cost of household goods and services since November 2014. According to the Office for National Statistic, the annual rate of CPI inflation equals 1%, up from 0.6%in August and slightly higher than economists had been expecting, 

Rising prices will "undoubtedly be tough on those with low incomes," said Ben Brettell, senior economist at Hargreaves Lansdown. "It's also not good news for savers who are losing money in real terms," he added.

"The prices paid by manufacturers for raw materials were unchanged over the month and there is no explicit evidence the lower pound is pushing up the prices of everyday consumer goods."

Meanwhile, the main upward pressure on consumer price index came from an acceleration of clothing and footwear price tags – especially women's clothes – with garments rising 6% between August and September, compared to a 3.3% rise over the same period last year. Moreover, the Office for National Statistics highlighted there were no 'explicit' signs that the weakness of the sterling contributed to the rose in CPI. The Bank of England said on Friday that it was willing to allow inflation to run "a bit" higher next year than its 2% target if it safeguarded jobs and boosted economic growth.

Sterling has dropped nearly 20% against the dollar since the Brexit vote, including a 5% fall this month after Prime Minister Theresa May set a timeline for the UK's withdrawal from the EU.