Although British inflation decreased last month after reaching a 41-year high in October, the pressure on households remained high as food and drink prices increased at the fastest rate since 1977. The cost of food and non-alcoholic beverages, led by eggs, milk, and cheese, was 16.8% higher than a year earlier, the sharpest increase since September 1977, while lower prices for gasoline and clothing helped to lower the headline rate.
In November, the Bank of England predicted that as energy prices stabilize, the headline CPI would decline from a peak of 11.1% in October of last year to about 5% by the end of 2023. British inflation in December was higher than the United States’ annualized rate of 6.5% and the 9.6% in Germany.
Finance minister Jeremy Hunt said after the figures were released that high inflation was a “nightmare for family budgets”, hurt business investment and led to strike action. Hunt has resisted pay demands from public-sector trade unions, many of whom are taking strike action as their members’ wages are rising much more slowly than inflation and by less than the average in the private sector.
