UK inflation soared to a new 41 year high of 11.1% as food prices soared

Food prices rose by a record amount as energy bill support failed to stop the rise

Inflation has hit a new 40-year high of 11.1 percent.

The latest Consumer Price Index (CPI) figure was the highest since October 1981 and marked last month's full percentage point increase, nearly double what economists had forecast.

Food prices saw their biggest jump since 1977, while soaring gas and electricity bills continued to drive the overall rise, the Office for National Statistics (ONS) said in publishing its latest data.

Chancellor Jeremy Hunt warned that controlling inflation would require "difficult but necessary decisions on taxes and spending", as he put the finishing touches on a fiscal statement expected to set out plans to raise around £60 billion "to help balance the books".

Mr Hunt blamed the impact of the pandemic and war on Ukraine for soaring prices, which he warned were "undermining the chances of long-term economic growth".

He said: “It is our duty to assist the Bank of England in their mission to return inflation to target by acting responsibly with the country's finances. That requires some tough but necessary decisions about taxes and expenses to help balance the books.

“We cannot have long-term sustainable growth with high inflation. Tomorrow I will lay out a plan to reduce debt, provide stability and reduce inflation while protecting the most vulnerable.”

Rishi Sunak said inflation was "the number one thing on people's minds" and promised the chancellor's statement would offer a "brighter future".

The prime minister may find his comments offer some respite for the British public facing a dismal winter as bills and food continue to rise sharply in price.

Gas and electricity prices made the biggest jumps, rising 23.4 percent despite the Energy Price Guarantee, the government's scheme to keep energy bills down.

Food prices rose 16.4 percent, with the cost of basic necessities such as tea bags, milk and sugar continuing to rise.

Supermarket prices of some of the most popular brand name food products have in some cases doubled in the past two years, research by Mana? found before the latest inflation data.

ritain is expected to enter recession in coming months, another economic headache for the government as fierce industrial disputes rage on while unemployment rises and workers face real wage cuts in the face of inflation.

Frances O'Grady, general secretary of TUC, said the cost of living crisis was "worse by the day" and urged ministers to raise public sector wages higher than the reported 2 percent on the table for next year.

He said: “Unless we get an economy-wide pay rise, we will continue to slide from crisis to crisis. We cannot become a country where nurses and teaching assistants have to use food banks to survive."

Households will soon see further increases in their mortgage payments as the latest figures from the ONS are likely to attract another rate hike from the Bank of England next month, with many experts predicting a half-point rise to 3.5 percent.

"Core inflation", which removes volatile food and fuel prices from the equation, remained at the same level as September but, at 5.8 percent, was still almost three times the bank's target for the overall figure.

Retailers are pressing the chancellor for more support to save the high street business ahead of what will likely be a disappointing Christmas for sales.

Helen Dickinson, chief executive of the UK Retail Consortium, said: “Many customers are highly anticipating Black Friday offers and other promotions leading up to Christmas, as they prepare to purchase party gifts and treats.

“Unfortunately, there is little sign that the cost of living crisis will subside any time soon.

"Tomorrow, the chancellor will unveil the fall budget, where she has the opportunity to provide support to struggling households and offset some of the costs of their retailers and suppliers, which in turn keeps prices down."

The latest rise in inflation comes after the increase in the energy price cap in October due to extraordinary wholesale prices as a result of Russia's invasion of Ukraine.

The government has provided some support, limiting the increase in bills to around £2,500 per year for households. The ONS said without this energy prices would be more than three times as high as they did last month.

Households pay, on average, 88.9 percent more for electricity, gas and other fuels than they paid a year ago, the ONS said.

Shadow Chancellor Rachel Reeves said the figures show the government is failing ordinary people. He said: “Another rise in inflation will strike more fear into the hearts of families across the UK who are dealing with soaring food prices, rising energy bills and Tory mortgage premiums on their homes.

“The British are feeling the impact of rising inflation far more than any other country because 12 years of Tory economic failure has exposed us to any shock.”  This article was written by EDUKASI CAMPUS. 

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