Effect on low-income households expected to be severe, as experts warn that figure could rise to 3% in coming months. The 0.5 percentage point increase in inflation to a five-month high is "disastrous" for savers and pensioners, and experts warn inflation could rise to 3% in the next few months. The Office for National Statistics attributed most of the rise in the Consumer Prices Index – from 2.2% in September to 2.7% in October – to the long-anticipated rise in annual university tuition fees from a maximum of just over £3,000 to £9,000. But food and non-alcoholic drinks were the second largest contributor to the increase, with potatoes, fruit and confectionary seeing particularly steep price rises. Recently announced rises in the cost of gas and electricity have yet to feed into the figures. Howard Archer, chief UK economist at IHS Global Insight, said: "Increasing energy charges by utility companies are set to exert upward pressure on inflation in the near term, while food prices could well rise higher still (largely due to recent poor grain harvests), which will weigh down on consumer purchasing power. Consequently, there is a very real danger that consumer price inflation could reach 3% over the next few months."....Read more here: Savers and pensioners hardest hit by 'disastrous' inflation increase