Inflation in the UK was 10.1% in September, the latest data from the Office for National Statistics (ONS) shows.
Housing and housing services, food and non-alcoholic beverages, and transport made the largest upward contribution to the monthly rates in September.
The latest figure is up from the 9.9% reported in August and returns to July’s recent high of 10.1%.
In August, Citi bank forecasted inflation to hit 18.6% in January.
In September, the Bank of England (BoE) increased the base rate by 50 basis points to 2.25%.
This is the highest the base rate has been for 14 years.
LiveMore managing director of capital markets and finance Simon Webb says: “The slight drop in inflation last month has been reversed with September’s double digit print and inflation remaining at a 40-year high.”
“One of the main reasons for high inflation is the surge in energy prices since the Russian invasion of Ukraine in February this year. Government efforts to help curb energy bills with an energy price cap of £2,500 for the next two years no longer stands as the new Chancellor Jeremy Hunt is only guaranteeing the cap until next April.”
“If government support for energy bills disappears, it is likely to result in higher inflation as well as negatively impacting on many people’s finances and living standards through 2023.”
R3 Mortgages director Riz Malik comments: “We are so far away from the government’s 2% inflation target, we need the Hubble Space Telescope to see it. I fear the Bank of England will continue to respond with aggressive rate rises to bring its 2% target back into focus.”
“However, raising interest rates in isolation is not going to help solve the inflation problem as most of it is being caused by external factors that are out of our control.”
Meanwhile, Loan.co.uk chief executive Paul McGerrigan adds: “The mortgage mayhem of the last fortnight, driven by the mini-budget debacle, coupled with a potentially record-breaking interest rate rise from the Monetary Policy Committee on the third of November, will put significant pressure on the CPIH, with increases inevitable in the coming months.”
