Britain’s inflation rate dipped to 3.1 per cent in the 12 months to September after the artificial blip caused by last year’s ‘Eat Out to Help Out,’ scheme dropped out of the figures, but higher prices are still to come.
The increase in consumer prices came in a notch lower than the 3.2 per cent seen in August, the Office for National Statistics said on Wednesday, but the reading was still well above the Bank of England’s 2 per cent target for a second month.
Financial markets are pricing in a BoE lift to interest rates next month to contain an upward spiral in prices, as central bank officials expect the headline inflation rate to jump above 4 per cent this year.
Eat Out to Help Out was a discount scheme devised last year by Rishi Sunak, Chancellor of the Exchequer, designed to attract diners back to hospitality venues to support the ailing sector after coronavirus lockdowns.
“Annual inflation fell back a little in September due to the unwinding effect of last year’s Eat Out to Help Out, which was a factor in pushing up the rate in August,” said ONS head of prices Mike Hardie.
“However, this was partially offset by most other categories, including price rises for furniture and household goods and food prices falling more slowly than this time last year.”
The cost of transport led gains in inflation in September, with a hefty jump in petrol prices even before the fuel crisis reduced supplies across the country.
Average petrol prices were at 134.9 pence ($1.85) per litre in September 2021, compared with 113.3 pence per litre a year earlier, as fuel provided an upward pressure on inflation, the ONS said.
Used car prices also rose sharply amid a global shortage of semiconductors, increasing 2.9 per cent on the month to September.
The cost of goods produced by factories also rose again with metals and machinery showing a notable price rise, while road freight costs for UK businesses continued the upward trajectory seen over the summer, Mr Hardie said.
These factors were offset by a sharp decline in prices at hotels and restaurants, which fell back in September when compared with a year ago.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said inflation could reach 5 per cent next April despite the slight dip this month, which could lead the BoE to increase interest rates imminently.
“With prices staying stubbornly high and another surge expected, a gentle rise in interest rates before the end of the year still looks likely if there is any chance of keeping a Goldilocks economy [where an economy is not too hot or too cold but just right, stealing a line from the popular children's story Goldilocks and the Three Bears] within reach,” Ms Streeter said.
“Too much inflation in the mix risks the economy getting too hot, leading prices to spiral upwards. If rates are pushed up rapidly, there’s a risk it gets too cold, freezing off economic growth. A 2 per cent inflation target is considered just right, as long as the economy also keeps growing.”
Chancellor of the Exchequer Rishi Sunak said the government is working with businesses and international partners to address the pressures of rising inflation as global shocks push up prices around the globe.
“We are supporting people with the cost of living, including through a new £500 million support fund to help vulnerable households, the energy price cap, and assistance with energy bills through the winter,” Mr Sunak said.
Britain’s recovery is already considered to be cooling rapidly amid supply chain issues, labour shortages and the soaring energy price.
Avoiding the bad dream of stagflation will still be the priority, Ms Streeter said, rather than the lofty aims of a Goldilocks economic utopia.
“If gas prices continue to spike and power rationing is introduced by energy intensive industries, economic growth could be knocked back into a downturn,” Ms Streeter said.
However, with the Monetary Policy Committee not entirely aligned on a rate rise, they may hold off from voting for an increase in November.
“A certain amount of nervousness ripples through the financial markets at the very thought of a rate hike, given that investors have become somewhat used to this era of ultra-low rates, so this edge downwards in CPI in September may provide some short-term relief,” Ms Streeter said.
“But even if the Bank of England does raise the base rate by a few notches in the months to come, it isn’t forecast that it will go much beyond 1 per cent next year.
“That is because central bank policymakers still believe inflation is transitory. Like porridge without enough milk, it’s sticking around for a lot longer than was previously thought, but is expected to ease off as pandemic supply chain issues finally lift."
Separately, house price growth returned to double digits in August, the ONS said, with average house prices up 10.6 per cent.
The average house price hit £264,000 in August, with homes costing £25,000 more than a year ago despite a temporary summer lull amid the tapering of the stamp duty holiday.
Meanwhile, eurozone inflation hit 3.4 per cent on the year in September, a 0.5 per cent increase on August as more expensive energy and services increased prices, the European Union's statistics office Eurostat said.
While the headline number was well above the European Central Bank's target of 2 per cent, the higher rate was caused mainly by the 17.6 per cent year-on-year surge in energy prices.
The ECB expects consumer prices to start easing next year.
ACL Elite (West) - fixtures
Monday, Sept 30
Al Sadd v Esteghlal (8pm)
Persepolis v Pakhtakor (8pm)
Al Wasl v Al Ahli (8pm)
Al Nassr v Al Rayyan (10pm)
Tuesday, Oct 1
Al Hilal v Al Shorta (10pm)
Al Gharafa v Al Ain (10pm)
if you go
The flights
Emirates flies to Delhi with fares starting from around Dh760 return, while Etihad fares cost about Dh783 return. From Delhi, there are connecting flights to Lucknow.
Where to stay
It is advisable to stay in Lucknow and make a day trip to Kannauj. A stay at the Lebua Lucknow hotel, a traditional Lucknowi mansion, is recommended. Prices start from Dh300 per night (excluding taxes).
GAC GS8 Specs
Engine: 2.0-litre 4cyl turbo
Power: 248hp at 5,200rpm
Torque: 400Nm at 1,750-4,000rpm
Transmission: 8-speed auto
Fuel consumption: 9.1L/100km
On sale: Now
Price: From Dh149,900
if you go
The flights
Emirates offer flights to Buenos Aires from Dubai, via Rio De Janeiro from around Dh6,300. emirates.com
Seeing the games
Tangol sell experiences across South America and generally have good access to tickets for most of the big teams in Buenos Aires: Boca Juniors, River Plate, and Independiente. Prices from Dh550 and include pick up and drop off from your hotel in the city. tangol.com
Staying there
Tangol will pick up tourists from any hotel in Buenos Aires, but after the intensity of the game, the Faena makes for tranquil, upmarket accommodation. Doubles from Dh1,110. faena.com
The specs: 2018 Audi Q5/SQ5
Price, base: Dh183,900 / Dh249,000
Engine: 2.0L, turbocharged in-line four-cylinder / 3.0L, turbocharged V6
Gearbox: Seven-speed automatic / Eight-speed automatic
Power: 252hp @ 5,000rpm / 354hp @ 5,400rpm
Torque: 370Nm @ 1,600rpm / 500Nm @ 1,370rpm
Fuel economy: combined 7.2L / 100km / 8.3L / 100km
More on Palestine-Israeli relations
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What are NFTs?
Are non-fungible tokens a currency, asset, or a licensing instrument? Arnab Das, global market strategist EMEA at Invesco, says they are mix of all of three.
You can buy, hold and use NFTs just like US dollars and Bitcoins. “They can appreciate in value and even produce cash flows.”
However, while money is fungible, NFTs are not. “One Bitcoin, dollar, euro or dirham is largely indistinguishable from the next. Nothing ties a dollar bill to a particular owner, for example. Nor does it tie you to to any goods, services or assets you bought with that currency. In contrast, NFTs confer specific ownership,” Mr Das says.
This makes NFTs closer to a piece of intellectual property such as a work of art or licence, as you can claim royalties or profit by exchanging it at a higher value later, Mr Das says. “They could provide a sustainable income stream.”
This income will depend on future demand and use, which makes NFTs difficult to value. “However, there is a credible use case for many forms of intellectual property, notably art, songs, videos,” Mr Das says.
Muguruza's singles career in stats
WTA titles 3
Prize money US$11,128,219 (Dh40,873,133.82)
Wins / losses 293 / 149
The specs
Engine: Direct injection 4-cylinder 1.4-litre
Power: 150hp
Torque: 250Nm
Price: From Dh139,000
On sale: Now
Groom and Two Brides
Director: Elie Semaan
Starring: Abdullah Boushehri, Laila Abdallah, Lulwa Almulla
Rating: 3/5
Paatal Lok season two
Directors: Avinash Arun, Prosit Roy
Stars: Jaideep Ahlawat, Ishwak Singh, Lc Sekhose, Merenla Imsong
Rating: 4.5/5
Test squad: Azhar Ali (captain), Abid Ali, Asad Shafiq, Babar Azam, Haris Sohail, Imam-ul-Haq, Imran Khan, Iftikhar Ahmed, Kashif Bhatti, Mohammad Abbas, Mohammad Rizwan(wicketkeeper), Musa Khan, Naseem Shah, Shaheen Afridi, Shan Masood, Yasir Shah
Twenty20 squad: Babar Azam (captain), Asif Ali, Fakhar Zaman, Haris Sohail, Iftikhar Ahmed, Imad Wasim, Imam-ul-Haq, Khushdil Shah, Mohammad Amir, Mohammad Hasnain, Mohammad Irfan, Mohammad Rizwan (wicketkeeper), Musa Khan, Shadab Khan, Usman Qadir, Wahab Riaz
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How to watch Ireland v Pakistan in UAE
When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.
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French business
France has organised a delegation of leading businesses to travel to Syria. The group was led by French shipping giant CMA CGM, which struck a 30-year contract in May with the Syrian government to develop and run Latakia port. Also present were water and waste management company Suez, defence multinational Thales, and Ellipse Group, which is currently looking into rehabilitating Syrian hospitals.
COMPANY%20PROFILE
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Why your domicile status is important
Your UK residence status is assessed using the statutory residence test. While your residence status – ie where you live - is assessed every year, your domicile status is assessed over your lifetime.
Your domicile of origin generally comes from your parents and if your parents were not married, then it is decided by your father. Your domicile is generally the country your father considered his permanent home when you were born.
UK residents who have their permanent home ("domicile") outside the UK may not have to pay UK tax on foreign income. For example, they do not pay tax on foreign income or gains if they are less than £2,000 in the tax year and do not transfer that gain to a UK bank account.
A UK-domiciled person, however, is liable for UK tax on their worldwide income and gains when they are resident in the UK.
From Zero
Artist: Linkin Park
Label: Warner Records
Number of tracks: 11
Rating: 4/5
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%3Cp%3E%0DThere%20are%20regular%20flights%20from%20Dubai%20to%20Addis%20Ababa%20with%20Ethiopian%20Airlines%20with%20return%20fares%20from%20Dh1%2C700.%20Nashulai%20Journeys%20offers%20tailormade%20and%20ready%20made%20trips%20in%20Africa%20while%20Tesfa%20Tours%20has%20a%20number%20of%20different%20community%20trekking%20tours%20throughout%20northern%20Ethiopia.%20%20The%20Ben%20Abeba%20Lodge%20has%20rooms%20from%20Dh228%2C%20and%20champions%20a%20programme%20of%20re-forestation%20in%20the%20surrounding%20area.%26nbsp%3B%3C%2Fp%3E%0A%3Cp%3E%3Cbr%3E%3Cbr%3E%3C%2Fp%3E%0A
