Join us LIVE as we explain what record inflation of 9.1% means for you and your money
Mirror Money experts Sam Barker and Graham Hiscott will discuss how rising costs are affecting your wallet live from 1pm this afternoon on the Daily Mirror’s Facebook page – and what you can do about it
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UK inflation has risen to 9.1% as the cost of living crisis continues to weigh on household finances.
The Consumer Price Index (CPI), a measure of inflation, rose to its highest level since March 1982 in the 12 months to May.
When inflation goes up, it basically means your money doesn’t go as far as it used to.
For example, if something cost £1 a year ago and the inflation rate has been 9% since then, it would cost £1.09 today.
Inflation also affects the purchasing power of your free money.
But while it’s bad news for savers, supermarket shopping and private pensions, it’s good news for groups like statutory pensioners.
This week on Cost of Living: We’re Here to Help Facebook, Mirror’s money reporter Sam Barker is joined by Mirror’s Head of Business Graham Hiscott to explain what it means to you.
Sam and Graham will be discussing inflation live The mirror’s Facebook page at 1 p.m. today, June 16.
Send us your questions in advance to firstname.lastname@example.org
Our team of cost of living experts are here to help YOU through a very difficult year.
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What happens if inflation rises?
Inflation is rising around the world – not just in the UK – and there are several reasons for this.
Household spending started to rise in early 2021 as the UK began easing coronavirus restrictions.
When people spend more, it drives up demand and prices.
“Economies around the world, including the UK, opened up after Covid restrictions were eased. And then, of course, people wanted to start buying things again,” explains the Bank of England.
“But companies selling some of these things couldn’t get enough of them for their customers. This led to rising prices – especially for goods from abroad.”
The Russian invasion of Ukraine earlier this year has also caused prices to rise, including a sharp increase in energy costs.
Agricultural commodities such as grain, which are needed to produce food, have also risen in the wake of the crisis.
The BoE also notes that “there are more vacancies than there are people filling them”.
This means employers have to offer higher wages to attract applicants, which drives up their costs and is reflected in their prices.
Which items increase in price?
The ONS said food and drink prices were the biggest contributor to rising inflation. The most dramatic increases were in the cost of bread, grain, and meat.
Market research firm Kantar has forecast the average annual grocery bill in the UK will rise by £380 this year.
Gas and electricity costs have also risen sharply after Ofgem’s price cap was raised by 54% in April.
Energy analysts Cornwall Insights warned this week that the October price cap could hit nearly £3,000 – which would mean a further £1,000 increase for families on top of the current April price cap of £1,971.
Meanwhile, fuel prices have reached record highs in misery for drivers who rely on their cars for work.
The prices of raw materials, household goods, furniture, as well as restaurants and hotels are also increasing.
https://www.mirror.co.uk/money/join-live-explain-what-record-27301927 Join us LIVE as we explain what record inflation of 9.1% means for you and your money