Inflation hits 40-year high at 9.4%

Inflation has hit a new 40-year high with consumer price inflation reaching 9.4% in June, up from 9.1% in May, as the cost of living crisis continues to accelerate, putting a further strain on household spending. 

According to the Office for National Statistics, the biggest contributors to the latest figure were rising prices across both petrol and food.

Motor fuels witnessed a 42.3% rise in June, the highest rate since before the start of the historical series in January 1989. Average petrol prices stood at 184.0 pence per litre last month, compared with 129.7 pence per litre a year earlier.

Meanwhile, food and non-alcoholic beverage prices have risen by 9.8% in the year to June 2022, up from 8.7% in May, and the highest rate since March 2009. 

The ONS said the annual rate partly reflects price rises over the last few months, including a 1.2% rise between May and June 2022. This monthly rise was the largest between May and June since 2008, and it follows similar monthly rises into April and May 2022.

The increase in the annual rate for food and non-alcoholic drinks was in part driven by price movements across more detailed classes, the ONS noted. The largest upward effect came from milk, cheese and eggs, for example, where prices of milk and cheese rose between May and June 2022, compared with price falls a year ago. Other upward effects came from vegetables, meat and other food products, such as ready meals.

Meanwhile, the annual rate for clothing and footwear was 6.1% in the year to June 2022, down from 6.9% in May. However, prices were little changed on the month in 2022 but rose by 0.8% between May and June 2021. 

The ONS said that prices across clothing and footwear normally fall at this time of year as the summer sales season begins, but there was “little movement” in 2022 and, in 2021, prices were still rising following the end of lockdown.