What stubbornly high inflation means for YOU: Business editor RUTH SUNDERLAND explains why more pain could be coming
The UK is in turmoil after the shocking news that average prices are 8.7 percent higher than a year ago.
The official consumer price inflation measure (CPI) stalled at 8.7 percent in May, unchanged from April, according to the Office for National Statistics.
But that 8.7 percent figure is just an average, and prices for different items are rising at different rates. For example, utility bills, used cars, flights and recreational spending all helped keep inflation so high in May.
Core inflation – the underlying figure that erases volatile food and energy prices – continues to rise, giving the Bank of England even more interest rate headaches.
The Daily Mail’s Ruth Sunderland says inflation has a “massive impact” on families, individuals and businesses, affecting wages, purchasing power and labor disputes. It has also sent mortgage rates up and led the Bank of England to raise key rates by 0.5 percentage point to 5% today.
Here’s what you need to know about why inflation is so high and what’s driving prices up: