Inflation hits 40-year high as cost of living crisis worsens

22 June 2022, 07:08 | Updated: 22 June 2022, 07:38

Prices have continued to rise at their fastest rate in 40 years as inflation reaches a new record high
Prices have continued to rise at their fastest rate in 40 years as inflation reaches a new record high. Picture: Alamy

By Daisy Stephens

Annual consumer inflation rose to 9.1 per cent in May, according to the Office for National Statistics.

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It is an increase from nine per cent in April.

It makes it the highest figure in 40 years.

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The increase matches what analysts had expected.

"Though still at historically high levels, the annual inflation rate was little changed in May," said ONS chief economist Grant Fitzner.

"Continued steep food price rises and record high petrol prices were offset by clothing costs rising by less than this time last year, and a drop in often fluctuating computer games prices.

"The price of goods leaving factories rose at their fastest rate in 45 years, driven by widespread food price rises, while the cost of raw materials leapt at their fastest rate on record."

Food prices have continued to rise
Food prices have continued to rise. Picture: Alamy

Labour shadow chancellor Rachel Reeves said the figure was "another milestole" for people watching living standards and wages "continue to plummet".

She hit out the government for using "sticking plasters" and failing to tackle the crisis.

"Today's rising inflation is another milestone for people watching wages, growth and living standards continue to plummet," she said.

"Though rapid inflation is pushing family finances to the brink, the low wage spiral faced by many in Britain isn’t new.

"Over the last decade, Tory mismanagement of our economy has meant living standards and real wages have failed to grow.

"We need more than sticking plasters to get us back on course - we need a stronger, and more secure economy.

"With Labour's Climate Investment Pledge, and our plans to buy, make and sell more in Britain, we will build the high wage, high growth, low and stable inflation economy we deserve."

Chancellor Rishi Sunak said the government was taking "targeted action" to help people struggling with the crisis.

He also promised he was using "all the tools" he could to bring inflation down.

"I know that people are worried about the rising cost of living, which is why we have taken targeted action to help families, getting £1,200 to the eight million most vulnerable households," he said.

"We are using all the tools at our disposal to bring inflation down and combat rising prices – we can build a stronger economy through independent monetary policy, responsible fiscal policy which doesn't add to inflationary pressures, and by boosting our long-term productivity and growth."