The UK's inflation rate accelerated to a 41-year high in October according to the latest data released by the Office for National Statistics (ONS) on Wednesday. Consumer prices rose 11.1 per cent in the 12 months through October, compared with 10.1 per cent in September. This figure is way above the economist’s expectations of 10.7 per cent, an Associated Press (AP) report said.
These latest figures have further raised the demands from the government to do more to ease the nation’s cost-of-living crisis. The official data also showed that inflation rates in October were driven by higher prices for food and energy. The ONS said that low-income households are facing a bigger hit from inflation than the wealthiest as energy and food take up a bigger share of their spending.
Bloomberg reported that gas prices surged almost 36.9 per cent on the month, and electricity rose 16.9 per cent.
This has resulted in an inflation rate highest since October 1981.
The new data comes as UK’s Treasury chief Jeremy Hunt is scheduled to unveil a new Budget on Thursday, which will include new tax and spending plans. As surging inflation is weighing on people’s spending power across the country, a new budget will have to deliver on the demands for higher wages, increased benefits, and more spending on health and education, the report said.
This will further complicate government efforts to decrease an estimated 50 billion-pound budget shortfall. This will also affect plans to restore the government’s financial credibility after former Prime Minister Liz Truss’s disastrous economic policies undermined investor confidence and sparked turmoil in financial markets, the report added.
Jeremy Hunt has said that “tough but necessary” decisions were required to tackle rising prices. In a statement he said, It is our duty to help the Bank of England in their mission to return inflation to target by acting responsibly with the nation's finances.”