The British economy – like that of much of the rest of the world – came to a shuddering halt when the COVID-19 pandemic struck in March 2020. The pandemic has led to rising food prices and there have also been inflationary pressures on wages.
Britain’s annual inflation rate rose by 3.2 percent – the biggest rise since 2012 and a sign that food, petrol and energy prices are in danger of overheating the economy.
The Office for National Statistics said consumer prices were up two percent since July and the annual rise was the biggest since March 2012.
Higher oil prices, shipping problems and shortages of components for cars and other goods have contributed to rising inflation in many countries around the world.
Last month euro zone inflation hit three percent, a 10-year high.
The UK figures may also have been bumped from the UK government’s Eat Out to Help Out scheme, which offered diners a discount on meals in August 2020 in a bid to hit the hard-hit hospitality industry.
The Bank of England predicts inflation will hit four percent later this year and is blaming higher energy prices and pandemic bottlenecks.
The price of second-hand cars has also gone up – by more than 18 percent since April – due to a shortage of new models.
Jack Leslie, a senior economist at the Resolution Foundation, told Reuters the inflationary pressures were “largely transitory”, noting that there “is little policy makers can do to stem this cost of living crunch.”