Inflation rose to 7% in the year to March from 6.2% in February, the highest rate since 1992.
As sharp increases in petrol and diesel costs mean prices are rising at their highest rate in 30 years, there is pressure on the government to do more to help those affected, he said BBC.
There is also growing concern about the wider impact Cost of Living Crisis, with the public increasingly interested in knowing when it will end. Here’s what the experts say.
However, it is expected to rise before starting a decline. In fact, the noted financial times, inflation in March was higher than the rate of “around 6%” forecast by the Bank of England at its last meeting. The bank has acknowledged that inflation could rise further in the autumn when the energy ceiling is next adjusted.
The energy price cap, the maximum amount a utility can charge an average UK customer electricity and natural gas they use has already gone from £1,277 to £1,971 a year, an increase of £693.
And it could get worse within months. Recent forecasts for energy prices are “dark reading,” wrote Alex Finnis for The Ibecause the next update in October should increase the upper limit even further.
Investment firm Cornwall Insight, which previously accurately predicted the increase in April, said the cap will rise by a further £629 this winter, reaching an average of £2,600 a year for customers on Standard Standard tariffs.
Meanwhile, hopes that prices could fall significantly in 2023 are fading. Cornwall Insight believes the price cap will finally drop next spring, but only to around £2,040 – which is higher than the current figure.
British Gas owner Centrica predicted in January that “high gas prices will be here for the next 18 months to two years“.
A similar tone sounds for the fuel. Experts predicted that we would face high fuel costs for the “foreseeable future,” it said Auto Express.
It explained that Russia is one of the world’s largest oil and gas producers, “so any disruption to its production processes,” such as the war in Ukraine, would have “global repercussions.”
However, it added that energy costs had been high “for almost a year” as demand surged as the world emerged from Covid lockdowns.
Is there a way out? Not in the foreseeable future. Relatively low barrel prices in recent years have put plans to drill for new reserves on hold. Even if a decision is made to explore new reserves, it can take years for new wells to come on stream in the volumes needed to impact the market.
Help from the treasury
Given the bleak outlook, pressure is mounting for the government to do more to help people. MPs from the opposition, anti-poverty campaign groups and the TUC said the Treasury should increase the financial support it offers to households and businesses.
The chancellor has promised a 1 pence cut in the property tax rate in 2024which it hailed as a “tax cut for workers, pensioners, savers” and “a £5 billion tax cut for over 30 million people”.
However, Labor Treasury spokesman Pat McFadden said The guard that “Rishi Sunak could have elected a one-off windfall tax on huge oil and gas company profits to cut household energy bills by up to £600 at a time like this”.
Instead, McFadden said, “he has decided to make Britain the only major economy to attract working people with higher taxes amid a cost-of-living crisis.”
https://www.theweek.co.uk/news/uk-news/956418/when-will-the-cost-of-living-crisis-end When will the livelihood crisis end?