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OECD Countries See Highest Inflation Since 1988

Industrialized OECD countries have seen a rise in inflation, a 34-year record high, since June 1988. The most recent statistics reveal the annual inflation rate in Organization for Economic Co-operation and Development (OECD), measured by the consumer price index (CPI), jumped to 10.3% in June 2022, versus 9.7% a month earlier.

In England, consumer prices saw an average rise of 9.1% in the year to June, which has been the speediest rate in inflation in the Irish economy since the year 1984. The rate is also higher than 7.8% in the year to May. Food and energy are top things with the main inflation rates.  

In the OECD countries, food prices jumped to 13.3% in June 2022, from 12.6% a month earlier, which is the highest amount in food price since July 1975. Alike, energy inflation rate rose to 40.7% year over year in June 2022, which is larger than 35.4 a month earlier.

Year-over-year inflation rate, apart from food and energy, rose to 6.7% in the month of June, from 6.4% in May.

Double-digit inflation was listed for almost a third of OECD countries, the highest was recorded in Turkey (78.6%) with the lowest in Japan (2.4%).

Measured by the harmonized index of consumer prices (HICP), year-over-year headline inflation, in the eurozone, had a jump of 8.6% in June, from 8.1% in May 2022. Both food and energy prices saw high rises between the months of May and June 2022. Flash estimate for the eurozone in July by the Eurostat suggests a further rise in year-over-year inflation rate (8.9%). In the meantime, price inflation, without considering food and energy, jumped to 4% versus 3.7% June 2022.  

As shown by Refinitiv data, stock markets are now pricing with a more than 90% possibility of a huge 50 basis point rate rise in the meeting to be held on Thursday while the central bank tries to curb inflation from a point recorded in four decades.

Additionally, a survey conducted by Reuters from over 70% of 65 economists and analysts predicts a half-point rise from the Bank of England's Monetary Policy Committee (MPC) in the current week.

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By Samira Ha. on August 4, 2022

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