From Brexit to Beyoncé: why UK inflation is still so painfully high

theguardian.com:

The Bank of England has struggled to understand why inflation remains high in the UK. It has fallen in France, Germany, the US and especially Spain, where inflation dropped to 2.9% in May compared with the UK figure of 8.7%. Here we look at the many reasons for the current crisis.

Motor insurance unexpectedly soared by 43.1% over the past year. Some firms, such as Direct Line, have been criticised for even greater increases. Record car prices during the pandemic and the higher cost of repairs are to blame, say analysts.

The ONS measures insurance quotes, so there is the opportunity for people to shop around and reduce the annual cost. But the industry exploits inertia, leaving many people to pay much higher rates than a year ago. All forms of insurance rose by a chunky 18.5%.

Flying has become a must-have for many people. Despite concerns about the environmental impact, airline bookings have rocketed this year. While bicycle prices increased by only 0.9% over the year to May, and motorcycle prices dropped 0.7%, air fares soared by 31.4%

Ryanair, Europe’s largest airline, reported a near-record €1.4bn (£1.2bn) profit last year and expects to better that in 2023, fuelled by a summer boom the company says will see a record number of passengers.

For the first time since the Bank of England began to worry about the effect of wages on inflation, Andrew Bailey, its governor, said the main driver of wages growth were City workers.

“Pay growth in lower-paid sectors like wholesaling, retailing, hotels and restaurants had been broadly flat,” said the minutes of the monetary policy committee (MPC) meeting last week. It shied away from pointing out these workers received 5.1% pay rises on average while those in the financial and business