The UK’s inflation rate hit another 40-year high in May, reaching 9.1 per cent, its highest level since 1982.
Fueled by higher food prices last month, the rise was in line with economists’ expectations that suggest inflation will march higher in the coming months to move into double digits by the autumn.
The Bank of England expects the inflation rate to exceed 11 per cent in October, significantly higher than other similar countries in the G7.
The rise in inflation will add to the cost of living pressure on households, intensify demands for wage rises to offset higher prices, and make it more difficult to resolve industrial disputes such as those on the railways.
Prices rises have been broad-based across goods and services. Food prices rose 1.5 per cent in the month alone with bread, cereals and meat rising fastest in price.
In May, the Office for National Statistics said that road fuel prices were 32.8 per cent higher than a year earlier, the largest annual jump in prices seen in this category since detailed indices were first compiled in 1989.
Grant Fitzner, ONS chief economist, added that there was still more inflation in the pipeline across factories in the UK in a sign that price pressures were still strengthening. “The price of goods leaving factories rose at their fastest rate in 45 years, driven by widespread food price rises, while the cost of raw materials leapt at their fastest rate on record,” he said.
In a statement, Rishi Sunak, the chancellor, said: “We are using all the tools at our disposal to bring inflation down and combat rising prices – we can build a stronger economy through independent monetary policy, responsible fiscal policy which doesn’t add to inflationary pressures, and by boosting our long-term productivity and growth. ”