THE rate of inflation hit 9.9% in the UK in August, according to new figures from the Office for National Statistics (ONS).
The largest contributor to the figure came from housing and household services and falling petrol prices.
Inflation hit 9.9% in August
Rising food prices made the largest upward contribution to the change in inflation.
Inflation is what goods and services are worth in a country.
If it is higher, that means everyday essentials such as food are more expensive.
The soaring rate reflects the current cost of living crisis, with millions of people struggling with rising energy bills, petrol prices and grocery costs.
James Brown, managing partner at consultancy Simon-Kucher and Partners, said businesses were still battling through historically high inflation.
He added: “Motor fuel costs fell which helped the headline numbers, but the continued rise in food costs has been a big part of keeping inflation high and will continue to be felt by families on every supermarket trip.”
The latest figures show a 0.2% drop in inflation compared to July, when it hit 10.1%.
That was the largest figure since 1997 and drew fears from the Bank of England (BoE) Governor the UK economy could be heading for a 15-month recession.
It comes after Prime Minister Liz Truss announced a price freeze on energy bills, meaning the average household will pay around £2,500 a year for bills from October 1.
They were due to rocket to £3,549 on average per year after the regulator Ofgem revealed its new price cap.
What does it mean for my money?
Rising inflation indicates that the cost of goods and services is rising, so your money won’t count for as much as it did before.
With inflation 10.1% in July, households were seeing prices rise at the fastest rate for years.
But with the rate dropping to 9.9%, it’s good news for your wallets and purses for now.
Prices on everyday items such as food and petrol will remain high for now though, as 9.9% is still very high historically.
High inflation is also causing wages for millions to stagnate, as they fail to keep pace.
Data from the ONS revealed yesterday, September 13, that workers are facing a “real terms” pay cut.
The Bank of England has upped interest rates to 1.75% in a bid to try and tackle soaring inflation.
It’s good news if you have lots of savings put away, but it means higher monthly mortgage repayments for first-time buyers.