Inflation soars to 6.2% but ‘worse is yet to come’
The rate is the highest since March 1992 when it stood at 7.1%, and is up from the 5.5% recorded in January.
According to the Office for National Statistics (ONS), it said transport, particularly fuel, helped push up the Consumer Prices Index (CPI) measure of inflation.
It noted that average petrol prices stood at 147.6p per litre in February 2022, compared with 120.2p a year earlier.
“The February 2022 price is the highest recorded. The average price of diesel in February 2022 at 151.7p per litre, was also the highest on record,” the ONS said.
Second hand cars also had an upward effect on the inflation figure, as it rose to 0.36 percentage points in February 2022, the largest contribution since the start of the national statistic series in January 2006.
Elsewhere, clothing and footwear prices rose by 8.8%, while furniture, household equipment and maintenance rose by 9.2% in the year to February.
Meanwhile shoppers also felt the pinch in their weekly grocery shop as prices for food and non-alcoholic beverages rose by 5.1% on the year. This is the highest contribution rate since September 2011.
The ONS also said that prices for recreational and cultural goods and services rose by 4.7% to February.
The CPI including owner occupiers’ housing costs (CPIH) rose by 5.5% in the 12 months to February 2022, up from 4.9% in the 12 months to January this year.
Just last week the Bank of England raised the base rate to 0.75%, with members of the Monetary Policy Committee noting that inflation is expected to increase in the coming months to around 8% in Q2 2022 (four times the 2% target) and “perhaps even higher later this year”.
This would mean a generation of people have never seen inflation at this high in their adult life.
‘Worse is yet to come’
Sarah Coles, senior personal finance analyst at Hargreaves Lansdown, said: “Inflation has hit a 30-year high, and worse is yet to come. The perfect storm of massive fuel and energy price rises, accompanied by food price hikes, supply chain problems and booming demand from those with lockdown savings to spend, pushed prices into the stratosphere. And this was even before the conflict in Ukraine began. By the time we get to April, and the massive energy price hike, millions of people will be feeling the pain of rising prices.
“For those on higher incomes, with some wriggle room, and luxuries left to cut, there may well be things they can do without. If you haven’t yet drawn up a budget to see where the savings are lurking, now is the time.
“However, those whose finances are already on a knife edge face the misery of choosing between cutting essentials or racking up debts that could make things even worse in the long run. If you’re in this position, it’s worth talking to a charity like Citizens Advice. They will know whether you can get more help from the government, or from alternative schemes run by charities and other organisations. At the very least, you’ll be able to talk to someone who understands what you’re going through, and can help you get any help that’s available.”