Petrol and food prices stoke inflation
By David Wood | 20th July 2022
Prices are continuing to rise at their fastest rate for more than 40 years, driven by higher petrol and food costs.
UK inflation, the rate at which prices rise, jumped to 9.4 per cent in the 12 months to June from 9.1 per cent in May, according to the Office for National Statistics (ONS).
Petrol prices rose by 18.1p per litre in June, while costs for milk, cheese and eggs also climbed, the ONS said.
Unions have been calling for pay rises to help workers cope as the rising cost of living eats into household budgets.
Fuel prices have soared in recent months, driven by the war in Ukraine and moves by the European Union to reduce its dependence on Russian oil.
It has led to the average family car costing more than £100 to fill up, according to the RAC. However, the AA said this week that lower wholesale costs of fuel were leading to cheaper prices at the pumps, though they still remain much higher than before the Ukraine war.
Anna Leach, CBI deputy chief economist, said: "Inflation hit another multi-decade high in June. The labour market is still tight, global price pressures are strong and another rise in Ofgem's energy price cap is in the offing. As a result, inflation is likely to stay high for the rest of this year, severely eating into strained household incomes.
"This data underscores the need to give people more control over their energy bills: through speeding up planning decisions for electricity infrastructure and creating a national effort to help households better insulate their homes.
"But to build resilience to price shocks over the longer-term, the government needs to focus on boosting the economy's supply potential. Incentivising investment through a permanent successor to the super deduction and supporting the development of green infrastructure are crucial first steps."
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