UK inflation rises back to 40-year high of 10.1% as food prices soar

Inflation returned to a 40-year high last month of 10.1 per cent after food prices soared.

The rate of Consumer Price Index inflation rose to 10.1 per cent in September from 9.9 per cent in August, the Office for National Statistics has said.

Inflation was slightly higher than economists had expected. They had predicted a figure of 10 per cent.

It matches the 40-year high inflation rate hit in July and remains well above the government’s target of 2 per cent.

Rising food prices were the largest contributor to soaring inflation between August and September, the ONS said.

Over the past year up to September 2022, the rising cost of housing and household services has been the main driver of increasing prices.

Responding to the figures, chancellor Jeremy Hunt said that the government “will prioritise help for the most vulnerable while delivering wider economic stability.”

But his Labour counterpart Rachel Reeves said that the figures would bring more anxiety to families.

“It’s clear that the damage has been done. This is a Tory crisis, made in Downing Street and paid for by working people,” she said.

“Mortgage costs are soaring, borrowing costs are up, living standards down and we are forecast to have the lowest growth in the G7 over the next two years,” Ms Reeves added.

The consumer price index rate of inflation for food and non-alcoholic beverages reached a 40-year high of 14.6 per cent in September. This was up from 13.1 per cent in August.

The annual rate of inflation for this category has continued to rise for the last 14 consecutive months, from negative 0.6 per cent in July 2021.

The current rate of food inflation is estimated to be the highest since April 1980.

ONS director of economic statistics Darren Morgan said: “After last month’s small fall, headline inflation returned to its high seen earlier in the summer.

“The rise was driven by further increases across food, which saw its largest annual rise in over 40 years, while hotel prices also increased after falling this time last year.

“These rises were partially offset by continuing falls in the costs of petrol, with airline prices falling by more than usual for this time of year and second-hand car prices also rising less steeply than the large increases seen last year.

“While still at a historically high rate, the costs facing businesses are beginning to rise more slowly, with crude oil prices actually falling in September.”

The principal economist at the Confederation of British Industry, Martin Sartorius, said that rising inflation underlined the need for government to give more details on its revised energy support package.

“Inflation returned to its recent 40-year high and is expected to grow further in October as energy bills rise in line with the government’s energy price guarantee.

“The prospect of household energy bills rising sharply again in April 2023 emphasises the need for government to set out the details of any future targeted support sooner rather than later, in addition to how the country will establish its longer-term energy security.”

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