UK inflation gathered speed in December as a temporary easing of Covid-19 travel restrictions helped to push up air and sea fares and a rise in global oil prices made fuel more expensive, official data showed on Wednesday.
Consumer prices rose 0.6% in annual terms after a 0.3% increase in November, the Office for National Statistics said. A Reuters poll of economists had pointed to a rate of 0.5%. Inflation has been below the Bank of England’s 2% target since mid-2019 and the COVID-19 pandemic pushed it close to zero as the economy tanked.
“We are going to be talking a lot more about inflation in 2021 than we did 2020,” said Jeremy Thomson-Cook, an economist at Equals Group. “Both Brexit and Covid-19 are factors that have caused substantial pain for businesses and their supply chains.”
The ONS said air and sea fare prices rose last month, making transport services the biggest contributor to the increase in inflation during December. Prices at petrol pumps rose by 1.5 pence per litre last month. Clothing and footwear prices – which rose last month, unlike in December 2019 – also contributed to higher inflation.