Double-digit inflation is a psychological blow for a country that hasn’t seen such price inflation very often in the past four decades. The last time it happened, when it was actually on the way down, the Falklands war was still a live news event, Margaret Thatcher was prime minister, Sir Geoffrey Howe was chancellor, and Boris Johnson was just maturing into the man he is today, at Eton College.
For most people under the age of about 60, inflation at 10 per cent-plus is an unfamiliar concept.
One thing that is perfectly clear about inflation accelerating towards five times the Bank of England’s official target of 2 per cent is that it means the cost of borrowing, like everything else, will be going up – meaning more expensive mortgages, overdrafts, loans, car leasing plans, and business working capital.
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