Soaring inflation hits 40-year high Business

The old inflation measure of the Retail Price Index – whose July reading will be used to set rail pass increases – rose 11.1%.

Pressure is mounting especially on low-income families. April’s price hike swallowed up an eighth of the money less well-off households left to buy non-essentials, according to Retail Economics, representing a massive £59 hit in the month.

While inflation is focused on basic commodities, including energy and food, which account for a larger share of spending by those with little money, inflation is already nearing 11% for tenth of the poorest households, according to the Institute for Fiscal Studies.

For the top 10%, the rate is still a painful 7.9%.

Heidi Karjalainen, an economist at IFS, said the situation would get worse.

“Continued pressures, such as the war in Ukraine, are likely to push Ofgem’s price cap in October, and other prices, including food prices, even higher later this year,” it said. she declared.

“We are likely to be in for an extended period in which the poorest households are facing even higher rates of inflation than the headline numbers suggest.”