In the UK, inflation exceeds 10% and lowers the cost of living

Inflation in the UK exceeds 10% and drives down the cost of living

Food particularly increased in July in the UK, including bakery, dairy, meat, vegetables and takeaway.< /p>

Inflation in the United Kingdom jumped in July to 10.1% year on year, passing the symbolic bar of a double-digit price increase which promises to aggravate the crisis a little more. cost of living.

Food particularly increased in July. Bakery, dairy, meat and vegetables, but also takeaways, lists Grant Fitzner, chief economist of the Office for National Statistics (ONS), on Twitter.

Inflation, which already reached 9.4% year on year in June, remains at its highest level in 40 years.

It is accelerating faster than economists forecast and could exceed 13% in October, the Bank of England predicts, when drastic hikes in energy prices, which are also soaring, are due to take effect for the individuals.

As a result, the purchasing power of the British is melting at record speed, with real wages, that is to say adjusted after increases prices, which were down 3% for the three months to the end of June, according to figures released by the ONS on Tuesday.

The economy is already taking a hit. Britain's gross domestic product (GDP) contracted by 0.1% in the second quarter, before it likely entered recession at the end of the year.

I understand times are tough and people are worried about the price increases that countries around the world are facing, Finance Minister Nadhim Zahawi said, highlighting $37 billion in aid. pounds (C$57 billion) already announced by the government.

From opposition to NGOs to corporations, many voices are calling for much more to be done for modest households facing historic price increases.

And while purchasing power is at the heart of the Tories' campaign to choose the successor to resigning Prime Minister Boris Johnson, critics are swelling over the executive's inaction before the two finalists Liz Truss and Rishi Sunak will not be decided at the beginning of September.

The cost of living crisis is now very real for households and businesses. A concrete solution is therefore needed to support the most vulnerable in the face of higher energy bills, writes the employers' union CBI in a press release.

Data from the ONS indicates that inflation has risen more sharply in the UK than in other G7 countries and many consumers are already being forced to make difficult choices to balance their budgets, according to Susannah Streeter, of Hargreaves Lansdown.

For comparison, consumer price inflation in France accelerated in July to 6.1% year on year , while inflation slowed in the United States to 8.5%, according to figures released last week.

Across the Channel, inflation was generalized last month, notes the ONS.

Beyond food and nutrition energy, she touched on basic items such as pet food, toilet paper, toothbrushes and deodorant, but also, in the midst of school holidays, holidays and air transport.

The cost of raw materials and goods leaving factories also continued to rise.

The Bank of England , which has already raised its interest rates several times since 2021 in an attempt to calm inflation, announced in early August a hike in its key rate of half a percentage point, the largest ever. increase since 1995.

The extent and depth of inflation is putting further pressure on the Bank of England to continue rate hikes. above its current rate of 1, 75%, estimates KPMG economist Yael Selfin.

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