Disappointing inflation figures but the real test of Government economic policy lies ahead

While economic growth is a priority, effects on the electorate’s personal finances are crucial. At the end of the day, people will only feel that the economic plan is working, if they see more money in their pockets.

And inflation is one of the biggest issues for many households with everything becoming more and more expensive.

UK inflation jumping to its highest level for 10 months in January is a concerning sign.

The fact that Chancellor Rachel Reeves said her “number one mission” was getting “more pounds in pockets” after the ONS confirmed the rise in inflation, is to be welcomed. It is acknowledgement of what is important to the public.

Despite the disappointing figure, the rate of Consumer Prices Index (CPI) inflation rose to 3 per cent in January from 2.5 per cent in December, there has been a great deal of fabricated outrage.

These figures cannot be read in isolation. Inflation has been much higher in recent years and against this backdrop caution must be exercised against hysteria.

This year, however, will be instructive as to whether the Chancellor and Labour Government is on the right track. As Roger Barker, director of policy at the Institute of Directors (IoD), says, the autumn budget’s impact will be felt in April with the private sector having to determine how it will respond to higher employment costs.