Inflation is set to soar even higher than the 6 per cent level predicted by the Bank of England, experts warned yesterday.
They advised families to pencil in a larger hit to their budget for shopping, bills and days out.
The inflation rate is currently 5.1 per cent, but the Bank expects this to peak at 6 per cent in April – the highest since 1992.
Inflation is set to soar even higher than the 6 per cent level predicted by the Bank of England, experts warned yesterday (file photo)
That would be three times the official 2 per cent target and could spell disaster for households struggling to make ends meet.
Families also face painful tax rises in April, designed to pull in more money for spending on the NHS and social care.
National Insurance is rising by 1.25 per cent while a freezing of income tax brackets will mean more people are dragged into higher rates.
Douglas McWilliams, of the Centre for Economics and Business Research think tank, advised households to ‘look out for inflation reaching over 6 per cent’.
The inflation rate is currently 5.1 per cent, but the Bank of England (file photo above) expects this to peak at 6 per cent in April – the highest since 1992
He added: ‘Although wages will rise both as a result of a higher cost of living and a tight labour market, at best they are unlikely to do much more than keep pace with inflation.
‘So watch out for a cost-of-living squeeze in the UK, especially as price increases outstrip growth in disposable income.’
Other experts previously predicted household budgets face a hit of at least £1,200 in 2022. It is thought US inflation – currently 6.8 per cent – could top 7 per cent.
Source: | This article originally belongs to Daily Mail