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Jeremy Hunt: Inflation may rise next month but our plan is working

Jeremy Hunt said that inflation is coming down but there may be a ‘blip’ in September (Jeff Overs/BBC/PA) (PA Media)
Jeremy Hunt said that inflation is coming down but there may be a ‘blip’ in September (Jeff Overs/BBC/PA) (PA Media)

Chancellor Jeremy Hunt has insisted the plan to halve inflation is working despite the continuing cost of living crisis.

Latest figures have shown that inflation eased back to 6.8 per cent in August from an eye-watering peak of 11.1 per cent last October, but is still far from the Bank of England’s 2 per cent target.

Prime Minister has Rishi Sunak pledged to halve inflation from 10.7 per cent back in January to around 5.3 per cent as one of his main pledges.

Defending the government’s plan, Mr Hunt told BBC’s Sunday with Laura Kuenssberg: “The plan is working, inflation is coming down.”

Put to him that inflation could have risen in August, Mr Hunt said: “I do think we may see a blip in inflation in September.

“But after that the Bank of England is saying it will fall down to around 5 per cent.”

It comes after the Office for National Statistics said it was revising its estimate for gross domestic product (GDP) for 2021 after getting access to new data suggesting Britain’s economy had already returned to its pre-Covid levels by then.

By the last three months of 2021, the economy is now estimated to have been 0.6 per cent larger than 2019 levels, compared to a previous estimate that it was 1.2 per cent smaller.

The revision means the UK’s economy is now believed to have grown by 8.5 per cent during 2021, compared to the previous estimate of 7.6 per cent, the ONS said.

The ONS did not change its estimate that GDP shrank by 5.8 per cent in 2020.