Rishi Sunak is boasting about his “achievement” in halving inflation. Like the fly on the ox’s neck congratulating itself on a hard day’s ploughing, neither he, nor his government, nor even the Bank of England and its interest rate rises, deserve the credit for falling inflation, which is driven by falling global energy prices.
When Russia invaded Ukraine in February 2022, the disruption to oil and natural gas supplies across Europe was immediate, with prices for natural gas surging to 10 times their pre-invasion level. Inflation, which measures average price rises over the previous 12 months, soared to 40-year highs in Britain and for other heavy users of natural gas such as Germany. But as the initial shock wore off and energy prices started to come down from the middle of last year, overall inflation everywhere has started to fall.
