Inflation is accelerating worldwide, with Britain in the lead. For the seven largest industrial countries as a group the rate is expected to rise from about 3 per cent last year to about 4½ per cent this year. The main reason is the increase in the pressure of demand, which has raised commodity prices, and which has resulted in the highest level of output relative to capacity since 1973 (see Chapter 2). Most countries, the UK in particular, have responded by raising interest rates, which will slow down growth rates this year and next.