PRICES rose at their highest level since October 2008 in the twelve months to August, the Organisation for Economic Cooperation and Development (OECD) revealed yesterday.
Consumer price index (CPI) inflation accelerated to 3.2 per cent over the year across the 34 member countries, up from 3.1 per cent in the year to July.
Energy and food price inflation again came in above the average for all goods, at 13.5 per cent and 4.6 per cent respectively.
Soaring energy prices were a particularly large component in pushing the CPI up by 3.8 per cent in the US, coming in at 18.4 per cent.
At 4.5 per cent the UK’s inflation rate is one of the highest in the rich world, exceeded only by Turkey, at 6.7 per cent, New Zealand, at 5.3 per cent, Iceland at five per cent and Estonia at 5.3 per cent.
However, the CPI increased by just 0.2 per cent in August on a month-by-month basis, down from a high of 0.7 per cent in March. Some analysts believe inflation will fall towards the end of the year.
“Inflation has nearly peaked in the US, and although it came in higher than we expected in the Eurozone, we think most pressures are dipping,” Andrew Kenningham from Capital Economics told City A.M..
The lowest rates of inflation were seen in Japan and Switzerland (both 0.2 per cent) and Slovenia (0.9 per cent).