MNI BRIEF: UK Inflation Soars To 30-Year High

UK consumer price inflation burst through expectations in December, rising by an annual rate of 5.4%, the fastest pace since March 1992. Analysts had been looking for a more moderate rise to 5.2% from 5.1% in November.

Food and non-alcoholic beverage prices accounted for much of the increase, adding 0.18 percentage points to the change in CPI, with eight of the nine major categories exerting upward pressure on the index. Motor prices actually shaved 0.04 percentage points from the change in CPI, despite hovering near historically-high levels, as highlighted in the MNI morning briefing. But that didn’t prevent core CPI from stretching to a new record high of 4.2% in December from 4.0% in November.

RPI surged to an annual pace of 7.5%, the highest rate since March of 1991, from 7.1% in November.