This morning’s announcement of the Consumer Price Index inflation figure by the Office for National Statistics, shows a slight decrease from 10.4%, to 10.1%. Personal finance expert, Kevin Pratt, has weighed in on why the figure refuses to budge below double figures, and what it means for consumers and businesses.
Kevin Pratt, personal finance expert at Forbes Advisor, says: “Inflation remains in double digit figures at 10.1% – it’s deeply depressing stuff, especially given the widespread expectation that it might fall below 10%. Any good news, such as falling costs at the petrol pump, is turned sour by soaring food prices, with inflation here nudging a shattering 20%. At 19.2% – up from 18.2% the month before – that’s the biggest annual increase in food prices for 45 years.
“Clearly, when people are battered at the supermarket checkout for their basics – the ONS highlights bread as seeing the highest increases since records began – they are going to draw in their horns when it comes to discretionary spending elsewhere in the economy. That’s more bad news for the UK’s beleaguered businesses as they struggle to generate sales and keep the economy moving.
“Every business is different, but one thing they have in common is rocketing energy bills, which are running red hot, way beyond today’s ONS numbers. Many firms face a simple but devastating choice – try to pass on costs to customers who can’t afford to pay higher prices, or shut up shop in the face of bills they can’t afford to pay.
“We need to see more action from government and commercial energy suppliers to help business, especially firms locked into expensive fixed deals arranged last year, when wholesale prices were at their height. With wholesale energy costs now much lower, surely something could be done to help commercial customers benefit sooner – without them having to wait until the end of their contract. Let’s face it, nobody benefits if a business closes its doors for good.”