Inflation

I see that even the BBC are having to report the bad news on inflation, although they are hiding it away so that they concentrate on the big stories - the return of Tory sleaze and the (second) coming of the messiah Barack Obama.

"UK producer prices rose at a record pace in May, official figures show.

Prices jumped by 8.9% from the same month a year earlier, the Office for National Statistics said. Input prices also shot up, 27.6% higher on the year.

The quickest growth since records began in 1986, it was driven by higher food, scrap metal and energy costs.

The data was much worse than analysts had expected, and came amid signs that the UK's economic growth is slowing and consumer confidence is crumbling.

A survey from the British Retail Consortium on Monday claimed that consumer confidence in the UK had tumbled to a record low due to rising prices and falling property values.

Excluding food, beverages, petrol and tobacco, producer prices rose 5.9% over the 12 months to May, sparking concern that inflation is spreading beyond the food and energy sector.

The worry for many observers is that accelerating inflation will see the Bank of England delay cutting interest rates, and may even force them to move borrowing costs higher."