Consumers suffer as inflation makes a comeback
UK consumers have been hit in the pocket June September with a significant increase in food and non-food inflation and the high Street. The annual rate of food price increases in the UK is now running at 4% for the year to September 2010, against just 3.8% last month. When you also take into account the fact that overall shop price inflation has increased to 1.9% last month from 1.7% in the previous month situation is beginning to turn ugly.
Let us not forget that this comes at a time when most UK households are struggling to stretch their existing budgets let alone make room for price rises which are running at 4% of food items. When you also take into account benefit cuts, tax adjustments and the ongoing reduction of the headcount in the public sector the situation is becoming very difficult for more and more households. Even though overall inflation is running well below the 4% food inflation we are still seen an increase in the cost of living at a time when very few people are able to secure any wage rises in place of employment.
Unless inflation comes under control in the short to medium term many people will be pushed over the edge and with wheat and other commodity prices moving higher, not to mention an increase in the cost of transport, we are unlikely to see inflation die a death.
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