News

Inflation is now forecast to hit 11 per cent in October, says Bank of England

This means it'll hit the highest rate since 1981

inflation

Chancellor Rishi Sunak this week announced cash payments of £650 to help low-income families. Image: HM Treasury/flickr

Inflation is forecast to hit 11 per cent in October, the Bank of England has said, prompting renewed fears for how millions of struggling Brits will cope.

The bank has raised interest rates from 1 per cent to 1.25 per cent in a bid to curb inflation, making it more expensive for businesses to borrow and grow, but this will push up mortgages and credit card payments for families nationwide.

Soaring prices mean inflation will hit the highest level since 1981, with last month’s forecast of 10 per cent revised upwards.

The Bank of England’s target rate of inflation is two per cent. Measures are aimed at meeting that, with prices for ordinary grocery items already shooting up.

As of April, 500g of beef mince had risen from £2.02 to £2.34, and 600g of chicken breast from £3.22 to £3.50. The bank has warned it will “act forcefully” if necessary.

However, the move to increase the cost of borrowing has been met with concern over its impact on those struggling to get by.

Pat McFadden MP, Labour’s Shadow Chief Secretary to the Treasury, said: “This underlines the seriousness of the situation facing the economy. Many families will be worrying about the impact this will have on their household bills.

“We need a plan for a stronger, more stable economy, that can weather the short-term issues and fix the foundations for the long-term.”

Citizens Advice Bureaus have been seeing growing numbers of people unable to cope with the combination of flat wages and rising prices, said Myles Fitt of Citizens Advice Scotland.

“So many households in Scotland are struggling to make ends meet already. With energy bills, petrol costs and other payments higher than ever while wages stagnate, CABs are seeing increasing numbers of people who are just unable to cope,” Fitt said.

“Today’s rise in interest rates will hit such people hard, making it even harder for them to meet their daily living costs. Governments need to recognise the scale of the crisis and make more support available to those who are struggling.

“In the meantime anyone who needs help with their finances can get free, confidential advice from their local CAB, or at our self-help tool www.moneymap.scot.”

Support the Big Issue

For over 30 years, the Big Issue has been committed to ending poverty in the UK. In 2024, our work is needed more than ever. Find out how you can support the Big Issue today.
Vendor martin Hawes

Recommended for you

View all
Energy bills are set to fall but UK families have already lost £72bn to 'staggering' prices
energy bills
Energy bills

Energy bills are set to fall but UK families have already lost £72bn to 'staggering' prices

Poverty costs the UK billions each year. Politicians must commit to ending it this general election
Trussell Trust food banks
General election 2024

Poverty costs the UK billions each year. Politicians must commit to ending it this general election

Abuse survivor tried to take her own life after years-long battle with DWP over disability benefits
Pound coins on a piece of paper with disability living allowancve
Department for Work and Pensions

Abuse survivor tried to take her own life after years-long battle with DWP over disability benefits

Rents in UK are rising at highest rate in decades. Will they keep going up?
rents uk
Renting

Rents in UK are rising at highest rate in decades. Will they keep going up?

Most Popular

Read All
Renters pay their landlords' buy-to-let mortgages, so they should get a share of the profits
Renters: A mortgage lender's window advertising buy-to-let products
1.

Renters pay their landlords' buy-to-let mortgages, so they should get a share of the profits

Exclusive: Disabled people are 'set up to fail' by the DWP in target-driven disability benefits system, whistleblowers reveal
Pound coins on a piece of paper with disability living allowancve
2.

Exclusive: Disabled people are 'set up to fail' by the DWP in target-driven disability benefits system, whistleblowers reveal

Cost of living payment 2024: Where to get help now the scheme is over
next dwp cost of living payment 2023
3.

Cost of living payment 2024: Where to get help now the scheme is over

Strike dates 2023: From train drivers to NHS doctors, here are the dates to know
4.

Strike dates 2023: From train drivers to NHS doctors, here are the dates to know