Alcohol and restaurant prices rose at their fastest pace since records began in 1997 last month, according to the latest figures from the Office of National Statistics. Although the consumer prices index (CPI) of inflation remained unchanged in May at 4.5%, the headline rate masked a 9.8% rise in alcohol and tobacco prices and a 4.5% increase in restaurants and hotel prices during the month. The increase in alcohol prices was driven by the rise in duty and VAT. The climb in VAT to 20% and increasing food costs impacted the cost of eating out. Prices for basic ingredients, such as bread, meat, vegetables and fruit also rose, up 5.8%, 5.1%, 5.1% and 5.4% respectively on last year. Although the overall rate of inflation stayed unchanged in May, it is the 18th month in a row that inflation has been above the Bank of England's target of 2%.

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