Britain’s inflation rate hit its highest level in 40 years as Russia’s war in Ukraine fueled further increases in food and fuel prices
Consumer price inflation accelerated to 9% in the 12 months to April, from 7% the previous month, the Office for National Statistics said on Wednesday. This is the highest rate since 1982, when inflation hit 11%, according to the agency’s statistical modelling.
The figures will increase pressure on the government to ease a cost of living crisis that economists say will lead to the biggest drop in living standards since the 1950s.
Millions of households across Britain were hit with a 54% rise in their gas and electricity bills last month after regulators raised the energy price cap to reflect increases in wholesale price. Russia’s invasion of Ukraine put additional pressure on food and energy prices.
The government could cut income taxes and is drawing up plans to increase subsidies for low-income people who struggle to pay their fuel bills, British media reported on Wednesday. He is also considering a windfall tax on energy companies benefiting from high oil and gas prices.
Inflation is soaring around the world, with the United States recording a nearly four-decade high rate of 8.3% last month. The 19 countries that use the euro have recorded inflation records for months, but the European Union’s statistics agency on Wednesday revised down its initial figure from 7.5% for April to 7.4 %. This keeps the annual rate stable with March, Eurostat said.
Central banks around the world have taken action to combat soaring consumer prices by raising interest rates. The US Federal Reserve raised its key rate this month for the first time since 2000 and hinted it would continue to do so, while the Bank of England was even more aggressive.
The bank has raised its key rate four times since December, reaching its highest level in 13 years this month.