Inflation, housing, savers and Rolls-Royce

All eyes are on the latest inflation data, released this morning. According to the Office for National Statistics (ONS), inflation has reached its highest rate for two-and-a-half years.

As measured by the Consumer Prices Index, annual inflation hit 1.8 per cent last month, up from 1.6 per cent in December. This is largely due to the rising cost of fuel, and is the fourth consecutive month that the rate has risen. Statistics from the RAC show that fuel prices peaked at a two-year high in early February.

Dominic Baliszewski, director of consumer strategy for Momentum UK, said: ‘A lot of people will be feeling the pinch, with disposable income taking a big hit. This fall in spending power is evident from the drop we’ve seen in high street sales, with figures from some sources indicating that retailers have experienced their worst January performance in four years. Along with rising inflation and rock-bottom savings rates, consumers are also facing low wage growth.