Inflation increases to 2.7%

| November 13, 2012 | 0 Comments
Inflation increases to 2.7%

A combination of higher tuition fees and food prices pushed the inflation rate up to 2.7 per cent last month, according to the latest figures from the Office for National Statistics (ONS).

Inflation on the Consumer Prices Index (CPI) increased to 2.7 per cent from 2.2 per cent in September, while the Retail Prices Index (RPI) measure of inflation, which includes housing costs, increased to 3.2 per cent from 2.6 per cent.

Students starting university this year faced maximum tuition fees of £9,000 after the cap was lifted from £3,375, and this was the main contributory factor to the increase.

Wet weather caused food prices to increase, due to poor crop yields, and confectionery prices rose after manufacturers reduced the size of products.

The October figures make it more likely that the Bank of England will revise its short-term inflation forecasts upwards when it releases its quarterly update later this week.

The ONS has revealed plans to introduce the CPIH measure of inflation from March 2013, which will include housing costs.

Meanwhile, the high cost of living has caused donations to charity to fall by £1.7bn in a year.

According to research by the Charities Aid Foundation and the National Council for Voluntary Organisations, charitable giving fell by 20 per cent this year.

Both the number of donors and the amounts being donated have fallen.

Three quarters of those who have cut their charity donations said this was due to a fall in their disposable incomes as the cost of living has risen.

The average amount people donate each month has fallen from £12 a month in 2009/10 to £10 in 2011/12.

The two organisations are launching a campaign to Back Britain’s Charities and promote charitable giving.

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