UK inflation hits 41-year high of 11.1% amid acute cost-of-living crisis

© Henry Nicholls, Reuters

Britain’s inflation rate rose to a 41-year high in October, fueling demands for the government to do more to ease the nation’s cost-of-living crisis when it releases new tax and spending plans Thursday.

Consumer prices jumped 11.1% in the 12 months through October, compared with 10.1% in September, the Office for National Statistics said Wednesday. The new figure exceeded economists' expectations of 10.7%.

Higher prices for food and energy drove Britain’s inflation rate to the highest since October 1981, the ONS said. It exceeds the record 10.7% inflation seen last month in the 19 European countries using the euro currency and the U.S. rate of 7.7%, which slowed in October.

The figures come a day before Treasury chief Jeremy Hunt is scheduled to unveil a new budget amid growing calls for higher wages, increased benefits and more spending on health and education as raging inflation erodes the spending power of people across the country.

Those demands are complicating Hunt’s efforts to close an estimated 50 billion-pound ($59 billion) budget shortfall and restore the government’s financial credibility after former Prime Minister Liz Truss’ disastrous economic policies undermined investor confidence and sparked turmoil on financial markets.

“We cannot have long-term, sustainable growth with high inflation," Hunt said after the inflation figures were released. “Tomorrow I will set out a plan to get debt falling, deliver stability, and drive down inflation while protecting the most vulnerable.”


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