LONDON (Parliament Politics Magazine) – With UK inflation reaching the two-digit figure for the first time since 1982, prices are still rising at their quickest rate in over 40 years.
According to the Office for National Statistics (ONS), inflation increased from 9.4% in June to 10.1% in the 12 months that ended in July.
The Bank of England stated that inflation, the rate of price growth, may reach a peak of over 13%.
The result exceeded economists’ expectations, with rising food prices accounting for the largest share.
Costs related to diesel, petrol and energy are also a factor.
Prices are rising faster than earnings, which is cutting into household budgets.
The ONS said that the two categories that contributed most to price increases in July were food and non-alcoholic beverages.
Bread, cereals, milk, cheese, and eggs saw the fastest price rise, but the prices of vegetables, meat, and chocolate also increased.
Other essentials like toilet paper, pet food, and toothbrushes also saw price increases.
Another significant contributing element was the cost of transportation, with hikes in both domestic and international train tickets. Due to the rise in demand, the cost of package holidays also climbed.
Everything has increased
Shaf Islam, who owns a restaurant named the Chutney Ivy in Leicester, claimed that the hospitality sector was experiencing steep cost rises.
He told the BBC that everything had gone up, from salt to soft drinks, rice to oil.
He continued his electricity bill was increasing to £3,000 from £1,000 a month.
Reluctantly, he was passing some of the additional expense on to clients.
They had raised prices for the first time in five years. He was aware how difficult it was for people, so he didn’t like doing it, he said.
The University of Nottingham full-time PhD student Rebecca Brown is concerned about what will happen when her energy costs increase once more this winter.
Already, the cost of her gas and electricity has increased from £80 to $140.
She contributes to her student debt by working part-time, and she and her partner split the expense of living.
After paying the rent, bills, bus ticket, phone, Netflix, and Spotify bills, she had about £300 to £400 per month left over for food, entertainment, and essentials, she said.
Things like going to the dentist and getting a haircut were very much off limits, but when she had needed it, her parents had helped her with that.
Following the Ukraine invasion by Russia, the price of food commodities has increased globally, which has contributed to higher costs at checkout counters in supermarkets.
The two nations, who are significant exporters of products like wheat and sunflower oil, have seen their supplies disrupted by the war.
Some commodities, particularly edible oils and grain, have significantly decreased in price, but it normally takes six months before this affects prices at retail stores.
Supermarkets have had little alternative but to pass on price hikes from suppliers, themselves battling with extraordinary inflation in raw material and ingredient input costs, said Kien Tan, director of retail strategy at PwC.
With claims that the cost of a pint of milk has more than doubled in some stores since the year’s beginning, this problem has been particularly acute in labour and utility intensive categories like dairy, he added.
