“It’s a major concern, and not just for this country, but also for the developing world,” he said. “Sorry for being apocalyptic for a while, but this is a major concern. »
While the sharp rise in the inflation rate in April in Britain was expected, the pain of these rapid and increasingly widespread price increases will be felt in households, as inflation outpaces wage growth.
Salaries excluding bonuses rose 4.2% from January to March, compared with the same period a year ago, data showed on Tuesday. High bonuses kept total pay rates above inflation, but these bonuses were limited to certain sectors and were particularly strong in financial and business services.
For now, a tight labor market is adding to inflationary pressures as it encourages businesses to pay their employees more – but not enough to keep up with rising food and energy prices. The unemployment rate fell to 3.7% in March, the statistics office said on Tuesday, and for the first time since 2001 there are fewer unemployed than vacancies.
Pressure on the government to support low-income people trying to cope with the rising cost of living has intensified. Prime Minister Boris Johnson said last week that further support would be announced in the coming months as Treasury resistance to additional measures appeared to be easing.
Inflation is unlikely to have peaked. Economists expect the energy price cap to rise again sharply when it resets in October and reflects rising energy prices since Russia invaded Ukraine. The Bank of England expects Britain’s inflation rate to peak above 10% in the last quarter of the year.