UK inflation climbs to highest level for nearly 30 years

Consumer prices in the UK are rising at their fastest rate in almost three decades, according to the latest figures.

Driven by soaring food costs and energy bills, inflation surged to 5.4% in the 12 months to December, up from 5.1% the month before, the Office for National Statistics (ONS) said.

Food prices were up 4.2% year-on-year — the highest rate since September 2013.

It comes a day after separate ONS figures showed that average pay rises are failing to keep up with the rise in the cost of living.

“Food prices again grew strongly, while increases in furniture and clothing also pushed up annual inflation,” said ONS chief economist Grant Fitzner.

“These large rises were slightly offset by petrol prices, which despite being at record levels were stable this month, but rose this time last year.”

The last time inflation was higher was in March 1992, when it was 7.1%.

Analysts have warned it could soon reach that level again. With a 50% higher energy price cap set to take effect in April, gas and electricity costs are likely to increase further — putting further upward pressure on inflation.