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It has just been revealed by the Bank of England that inflation has risen to 5.2% - its highest level in three years. The figure is up from 4.5% in August, and rising energy costs seem to be the main culprit to blame for the hike.
These figures are bad news for the British public, who will have to tighten their purse strings even further to deal with the rising cost of living. Last week it was revealed that earnings only grew by 1.8% last year, so wages are struggling to keep up with the rapid rise in prices.
In addition to spiralling commodity prices, the weak pound and higher VAT rate of 20% has led to the high inflation figure. However, the Bank of England are hoping that this is as bad as it will get, and that inflation rates will begin to fall in the new year.
Still, it isn’t all that bad. Even though we are at our highest level of inflation in three years, there have been other times where we have been much worse off. For example, in 1800 inflation rose to 36% to help the government pay for an on-going conflict with France. Inflation came close to that rate again in the 1970s, when prices rose by 25%.
However, those figures pale in comparison to other countries around the world. In 1923, Germany had an inflation rate of 85,000,000,000%. Wallets were replaced with wheelbarrows as people had to carry around large piles of paper cash.
In more recent history, Zimbabwe made the news with an inflation rate of 66,212% in 2010. The situation got so bad that the Zimbabwean dollar was suspended, and the country now uses a mix of South African rand, Botswana Pula, American dollars, British pounds and Euros to make cash transactions.
Hmm… 5.2% doesn’t seem so bad now, does it?
Are you starting to feel the increased cost of living? Tell us about it in the comments section below.
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October 18, 2023
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