There appears to be no end in sight to surging prices and falling living standards as inflation jumped into double digits for the first time since 1982
Struggling households could be hit with another big increase in the cost of borrowing after new figures showed prices were spiralling even higher than expected and インフレーション could now hit a staggering 18 per cent for Britain’s least well-off.
There appears to be no end in sight to surging prices and falling living standards as inflation jumped into double digits for the first time since 1982.
Figures announced on Wednesday showed consumer prices rose 10.1 パーセント in the year to July – outpacing analysts’ expectations and leaving the UK with the worst inflation rate of any leading economy.
The poorest households will be hit much harder than the top-line figure suggests because inflation is being driven by the cost of essential goods such as food and energy, データが示した.
Food prices jumped 12.7 per cent with some basic items including milk, butter, and pasta rising even faster at between 20 パーセントと 30 パーセント.
Economists now widely expect the Bank of England to announce a second 0.5 percentage-point rate rise in a matter of weeks when its policymakers meet on 15 9月, deepening the winter misery for millions of homeowners just before average energy bills are set to almost double to £3,600 a year on 1 10月.
A 0.5 per rate increase would add another £700 a year to interest payments on a £250,000 mortgage, further eating into household budgets that are being decimated by inflation.
Lenders have already begun increasing rates and removing their best deals from the market in anticipation of the Bank’s next move.
George Dibb, head of the Institute for Public Policy Research‘s Centre for Economic Justice, said worse-than-expected inflation numbers had increased the likelihood of an interest rate rise and underlined the need for further financial support from the government.
“The biggest warning sign in today’s data is that food prices appear to be rising quickly. This is obviously concerning given some households will already be struggling to pay their bills and afford essentials," 彼は言った.
“We are not powerless in the face of inflation. Policies can be adopted now to bring it down and help households, and not just interest rate rises. Action now can help avoid a damaging recession caused by everyone feeling the pinch.”
The latest alarming data adds to pressure for political action, but Downing Street remains in a state of inertia while Tory leadership hopefuls リズ・トラス そして リシ・スナック battle it out to be next prime minister.
ボリス・ジョンソン has refused to announce any further cost of living support until his replacement is in place on 5 September and neither Truss nor Sunak has laid out how they would tackle the biggest upheaval to living standards for decades.
ザ・ 財政研究所 has issued a damning verdict on both candidates’ claims they would slash taxes without cutting spending. The respected economic think tank said the pair’s proposals were “hard to square” with the reality Britain faces.
その報告によると: “The two candidates for prime minister need to recognise this even greater-than-usual uncertainty in the public finances. Additional borrowing in the short term is not necessarily problematic – and indeed may be appropriate to fund targeted support.”
追加しました: “Only last month the OBR [予算責任局] 財政はすでに持続不可能な長期的な道を歩んでいると警告した: 大きい, 資金不足, permanent tax cuts would only act to make this problem worse.”
Labour has said it would freeze domestic energy bills at current levels for six months at a cost of £29bn, partly funded by a windfall tax on oil and gas company profits.
The party estimates that its “fully-costed” proposal would have the added benefit of reducing inflation by around 4 パーセンテージポイント, easing pressure on the Bank to hike interest rates.
Research by the IPPR think tank backed up Labour’s claim, finding that a freeze would reduce peak inflation from 13 パーセントから 9 per cent later this year.
Wednesday’s figures revealed a widening gulf between the relative impact of the cost of living crisis on Britain’s richest and poorest groups.
The Office for National Statistics found that the gap between inflation rates for the richest 10th of households and the poorest was the widest for more than 20 年.
According to estimates from the IFS, Britain’s lowest-income families will see inflation surpass 18 per cent because they spend a larger proportion of their budgets on food, ガス, electricity and fuel which have seen the biggest price rises.
Annual food inflation is now 12.7 per cent while the energy price cap has jumped more than 50 パーセント.