Black & White Bridging's comment on today's inflation increase

18 December 2024

Martyn Smith, Managing Director at Black & White Bridging, commented:

"Unfortunately, inflation seems determined to leave the economy anything but ‘merry and bright’ this Christmas. CPIH has climbed to 3.5% in November, up from 3.2% in November, and CPI reaching 2.6%, from 2.3% previously a second consecutive monthly rise. On a monthly basis, these increases signal persistent inflationary pressures, particularly driven by transport.

“At the same time, last week’s GDP figures revealed a second consecutive monthly decline of 0.1% in October, following a similar fall in September. While Real GDP showed marginal growth of 0.1% over the three months to October, with growth in the construction sector, the trajectory is still deeply concerning. Declining production output continues to drag on overall performance.

“If inflation continues its upward climb into next month, coupled with further GDP contraction, the UK risks sliding into a technical recession. For lenders, businesses, and households alike, this presents a challenging environment marked by squeezed budgets, increased borrowing costs, and mounting uncertainty.

“We remain committed to supporting our broker partners through this changing climate, offering flexible and reliable solutions to help navigate the pressures ahead. It is crucial that policymakers strike the right balance to control inflation without stifling growth further."