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Economists forecast biggest drop in living standards as UK inflation hits 40-year high
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Economists forecast biggest drop in living standards as UK inflation hits 40-year high
May 18, 2022 4:02 AM

Britain's inflation rate rose to the highest level in 40 years last month as Russia's war in Ukraine fuelled further increases in food and fuel prices.

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Consumer price inflation accelerated to 9 percent in the 12 months through April, from 7 percent the previous month, the Office for National Statistics said Wednesday. That is the highest rate since sometime in 1982, when inflation reached 11 percent, according to statistical modeling by the ONS.

Also Read:

India April wholesale inflation surges to record high on price rise across all items

Millions of households across Britain were hit with a 54 percent jump in gas and electricity bills last month after regulators boosted the energy price cap to reflect previous increases in wholesale prices. Russia's invasion of Ukraine has put further pressure on food and energy prices.

The figures will increase pressure on the government to mitigate a cost-of-living crisis that economists forecast will produce the biggest drop in living standards since the 1950s.

Also Read: Federal Reserve to keep hiking rates until it controls inflation, says Jerome Powell

The government may cut income taxes and is drawing up plans to boost subsidies for low-income people struggling to pay fuel bills, British media reported Wednesday. It is also considering a windfall profits tax on energy companies benefiting from high oil and gas prices.

(Edited by : Asmita Pant)

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