British inflation recorded its sharpest jump in more than two years in September, even without any direct evidence of the weaker pound pushing up prices. David Pollard reports.
Inflation's back in fashion on Britain's post-Brexit high street - with a flourish. Consumer prices showing their sharpest jump in two years. And that in September - even before this month's plummet in sterling. (SOUNDBITE) (English) CITY INDEX, RESEARCH DIRECTOR, KATHLEEN BROOKS, SAYING: "We are expecting to see further increases over the next 6, potentially 12 months. That's not going to be good news because we don't expect wages to be going anywhere in that period of time." Clothing and fuel were the main drivers behind the increase to a headline one per cent rate - the highest since November 2014.. The core rate - which strips out some volatile elements like food - even higher. (1.5%). Last week's so-called 'Marmitegate' episode - Tesco in a stand-off with supplier Unilever over its demands for price hikes - hinting that supermarkets are willing to shield consumers - if they can. (SOUNDBITE) (English) CITY INDEX, RESEARCH DIRECTOR, KATHLEEN BROOKS, SAYING: "That's good for now, but we don't think it can last. We certainly think there's going to be a drop in consumer spending as prices rise over the next year." The Bank of England, meanwhile, trying to shield the economy from Brexit-related weakness. But the pound's near 20 per cent drop since June's EU referendum now making further rate cuts unlikely. A prospect which gave sterling a brief recovery as this new data was announced.