Inflation hits fresh 40-year high of 9.4%

The rate of inflation has hit a fresh 40-year high, according to the latest data from the Office for National Statistics (ONS).

The UK’s consumer price inflation reached an annual rate of 9.4% in June, up from May’s figure of 9.1%, the ONS said.

It said that June’s inflation figure was partly due to a 42% year-on-year increase in petrol prices and an increase of almost 10% in food prices.

The prices paid by factories for materials and energy were 24% higher in June than a year earlier – the biggest increase since records began in 1985 – while prices charged by factories jumped by 16.5%.

The Bank of England is expecting a further acceleration in October when the energy price cap is adjusted again and is predicted to surge towards average annual bills above £3,000.

Anna Leach, Deputy Chief Economist at the Confederation of British Industry (CBI), said: ‘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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