Inflation rates across all age groups rose sharply during January, with 50-64 year olds continuing to face the highest rate, at 5% This month's official inflation report showed that the headline rate of inflation rose from 2.9% to 3.5% in January. Alliance Trust's monthly study of inflation rates facing different age groups reveals that each group continues to face a rate of inflation considerably higher than the official rate, and that these have increased even further this month. For the fourth consecutive month, it is the 50-64 year old age group which faces the highest rate of inflation, at 5.0%, followed by the 30-49 year old age group, whose current inflation rate is 4.8%. The 50-64 year old group is facing a rate of inflation which is 43% higher than the official rate, largely due to the fact that this group spends relatively more on transport, where inflation is currently high, at 11%. In particular, fuel price inflation is currently running at more than 25%. Furthermore, for the fourth consecutive month, it is the over 75s who are facing the lowest rate of inflation, at 3.7%, helped by the fact that this group spends relatively more of their budget on food and utilities, where inflationary pressures remain contained. Shona Dobbie, Head of the Alliance Trust Research Centre, said, "As expected, inflationary trends have increased sharply this month, reflecting the recent increase in VAT, rising prices for alcoholic beverages and tobacco, high fuel costs and the fact that the recent depreciation of sterling has pushed up the cost of imported goods. These price moves continue to have the greatest impact on the two working age groups who spend a larger proportion of their budgets on the goods and services which are currently seeing the highest price increases. The fact that both working age groups now face an inflation rate in excess of 4.8%, but average earnings have grown by only 1.6% over the last year, highlights the sharp erosion of purchasing power which we have been pointing out over the last few months." Click here to view the full Press Release

Latest Publications UK Financial Reality Index – Q4 2009 US Financial Reality Index – Q4 2009 UK Financial Reality Index – Q3 2009 US Financial Reality Index – Q3 2009 Press Releases Inflation rates across all age groups rose sharply during January, with 50-64 year olds continuing to face the highest rate, at 5% Temporary decline in inflation spurs further improvement in financial health of the UK consumers Working age groups face rate of inflation of more than 4% More Press Releases

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