UK annual inflation rose 9.1% in May, the highest rate in 40 years amid the country’s cost of living crisis, it was officially reported on Wednesday.
This is the highest 12-month Consumer Price Index (CPI) inflation rate on record by the Office for National Statistics (ONS) that began in January 1997, reported the agency itself.
Indicative modeled consumer price inflation estimates suggest that the CPI would have last been highest around 1982, where estimates range from almost 11% in January to about 6.5% in December.
According to the ONS, the increase in the prices of food and non-alcoholic beverages translated into the largest contribution to the rise in monthly rates in May 2022, as well as the increase in fuel which reached an all-time high last week.
Russia’s war in Ukraine restricted supplies of wheat and corn of two of the world’s largest exporters.
Ukraine is also a major producer of sunflower oil, which is driving up the costs of alternatives as well.
In monthly terms, consumer prices rose 0.7% in May.
In the past week, the Bank of England (BoE) warned that inflation was on track to hit 11% by October this yearamid rising gas and electricity prices.
The Bank also raised interest rates last Thursday for the fifth consecutive time to 1.25%, to deal with rising inflation.
The BoE’s decision remains in line with the US Federal Reserve, which announced the day before the biggest increase in interest rates in almost 30 years as part of its strategy to stop the increase in inflation, raising the interest rate loan benchmark by 0.75 percentage points.
In the meantime, in the UK economists expect the inflation rate to hover between 9% and 10% in the coming months before rising again in October, when the next energy price cap adjustment is implemented.
Grant Fitzner, chief economist at the ONS, said prices for goods leaving factories rose at their fastest pace in 45 years in May, driven by “widespread increases in food prices”. the BBC.
Fitzner added that the cost of raw materials “jumped at its fastest pace on record.”
Responding to the latest rate of inflation, Finance Minister Rishi Sunak said the government was “using all the tools at its disposal to reduce inflation and combat rising prices.”
