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The 12 months UK inflation rate dropped to 8.7% in April as price rises slipped out of digits with double figures. Recent ONS (Office for National Statistics) figures indicated the inflation rate dropped from the 10.1% it recorded in March. In any case, the drop marked the first time it dropped to lower than double digits from last year in August. But consumers are still concerned with the current price rise rate on food.
The Office for National Statistics explained that the drop in the inflation rate resulted from stable electricity and gas costs through April. The ONS further clarified that the prices were still rising marginally slower despite the drop in inflation. In general, ONS believes that non-alcoholic beverages and food prices rose through April, contributing to the inflation rate rise. Although the level of UK inflation dropped, it is still above the Bank of England’s 2% target.
Thus, food prices have remained controversial throughout 2023 as critics accused supermarkets of over-inflating prices. Meanwhile, major UK supermarkets have lowered costs on brand products like oil, butter, bread, and milk since last month. Jeremy Hunt, the Chancellor of the Exchequer, commented on the inflation rate last week. He said that the IMF had concluded that the UK acted decisively to tackle inflation.
Hunt clarified the importance for the UK to stick firmly to lowering the inflation rate and supporting families with about £3,000 in living costs. On the other hand, Rachel Reeves, the Labor shadow chancellor, accused the Tories of failing to tackle the living cost crisis properly. Rachel said while bills rise daily, families remain wary that the cost of essentials such as food will still rise.
She clarified that the question is why the government failed to tackle the living cost crisis properly and why they do not collect proper windfall tax on oil and gas giant companies raising enormous profits. Overall, the core inflation rate increased last month to 6.8% from 6.2% in March, hitting the highest record since 1992. Banks are now worried about the next core inflation rate since it strips out factors like food and fuel.
Royal London’s consumer finance specialist also commented on inflation. Mrs Sarah Pennells said although the inflation rate dropped, prices rose more than wages, trapping many consumers in a financial crisis. She explained that food inflation was still high, and the previous 12 base rate rises ratcheted the homeowners’ borrowing costs. Above all, many families recorded cutbacks in spending, but most remained overdrawn and needed to borrow.