UK inflation is simply not meant to rise as high as 9%, and officials face a battle to get it down.
The question now is how quickly will inflation come down from these highs over the next two years.
Those projections reveal an uncomfortable truth. The last time inflation hit these levels, it took years, not months, to get it back down again. Only today, petrol and diesel prices hit new records, even after the impact of the chancellor's 5p cut on fuel duty. So, numbers of this magnitude create acute social issues. The price rises are highest for goods and services that form the largest part of the spending of the poorest. Poverty will go up, hunger will go up, homelessness will go up, destitution will go up.But when the price rises are so widespread and visible in the energy direct debits and prepayment meters of households, they also create a macroeconomic problem, draining the economy of spending power and slowing it down to a halt, or worse.
It is notable that the UK now has the highest annual inflation of the G7 group of major economies. That could change, but right now prices in France, which capped energy bills ahead of the presidential election, are rising half as fast as they are here.
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