Chancellor Jeremy Hunt predicts inflation will halve by end of year
Chancellor Jeremy Hunt said the UK may experience a “blip” increase in inflation this month, but he still predicts that inflation will halve by end of 2023.
Hunt said the blip will be down to expected rises in the cost of fuel, but he claimed the Government plan to lower inflation was working.
The RAC reported today that last month saw one of the biggest increases in the price of fuel in 23 years, with the average price of unleaded petrol finishing August at 152.25p, adding more than £4 to the price of a full tank compared to July.
Hunt said the Government is on track to hit its target of halving inflation by the end of the year but suggested the rate of price rises could spike when the latest figures for August are published in September.
UK inflation hit a 40-year high of 11.1% in November 2022 because of the soaring prices of goods and services ranging from energy and food to transport and clothing. Russia’s invasion of Ukraine caused fuel and energy prices to rocket.
Hunt: ‘Inflation will fall to around 5%’
Prime Minister Rishi Sunak has pledged to halve inflation, while the Bank of England has raised interest rates at 14 consecutive meetings in a bid to slow the rate of price rises.
In an interview with the BBC on Sunday, Hunt said the Government’s “plan is working, inflation is coming down”,
But when it was suggested that inflation could have risen in August, he said: “I do think we may see a blip in inflation in September. But after that the Bank of England is saying it will fall down to around 5%.
“And you know, if we are going to put money in people’s pockets quickly, the fastest thing I can do is to deliver the Prime Minister’s pledge to halve inflation, because that puts not 1p in the pound, which might be a tax cut, but 5p in the pound in people’s pockets that they wouldn’t have had, if inflation stays high.”