Inflation’s New Frontier: School Fees & Airfares Taking the Spotlight
Heads up! The start of the year has brought a double whammy: private school tuition and airfare are both climbing, and that’s sending the Consumer Prices Index (CPI) straight up to 2.8% in January.
Why the Sudden Surge?
- VAT Vortex: Labour’s recent VAT hike means a blanket 20% rise has been slapped on private schools and boarding fees.
- Parent’s Wallet Squeeze: Parents now feel a heavier bite as schools pass those extra costs straight to them.
- “Wild Card” in Play: Pantheon Macroeconomics says private‑school fees are a big wildcard—predicting a 14‑month quarterly jump for both primary and secondary grades.
Airline Prices Take the Skies Higher
Seasonal demand is up, so think of airlines as the icing on the inflation cake: they’re expected to boost their prices in January, nudging services‑inflation beyond the 5% mark. That comes on the back of a 4.4% inflation rise.
Will the Bank of England Lose Its Cool?
Even with all these price jumps, inflation is poised to open the door past the Bank of England’s 2% target. No doubt, the central bank will be keeping a close eye on this rapidly shifting landscape.
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