In the News

Inflation Reaches 11% - A Look Inside Britain's Cost of Living Crisis

Graham Watson

16th November 2022

This Reuters clip looks at the impact of the cost of living crisis in Burnley, highlighting the fact that inflation differs from place to place, with the Lancashire town the worst off.

It shows the very real cost of the crisis for pensioners, and other low income families, at a time when the government are going to announce another round of austerity measures.

Inflation rose by 11.1% in the year to October, well above market expectations and Bank of England forecasts. This is the highest rate of inflation for 41 years. It is not difficult to see where the inflation is coming from!

  • Goods price inflation: 15%
  • Services price inflation: 5%
  • Food price inflation: 16%
  • Electricity, gas and other fuels prices inflation: 24%

With wages lagging price rises and tax cuts for all about to beannounced in the November Fiscal Statement, the squeeze on real living standards continues to grip ever tighter.

The Guardian here with its take on the latest inflation data, arguing that, as ever, the most vulnerable are going to suffer most - not only are the distributional effects of inflation uneven, but the policy response to the current environment will exacerbate this.

In the short-term, the Autumn Statement is going to focus on austerity, and monetary policy is likely to be tightened further, reducing post-housing cost incomes for many too.

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to tutor2u, reads voraciously and is interested in all aspects of Teaching and Learning.

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