Is there a glimmer of hope in the cost of living crisis? | 5 News

The heat may finally be coming off inflation. Is this fish and chip shop in south London still feeling the effects? Our gas electricity was about £500 a month. Now it's £1,500 a month. It's not just gas and electricity, food prices. We've gone up a bag of potatoes, we're paying 21 quid at the moment, they can go up to 30, we don't know, it's just one problem after another and it's a challenge, to say the least, it's a challenge, very, very challenging, whereas the inflation rate may be falling now prices continue to rise less rapidly than before and food prices remain worryingly high between April 2022 and April this year the price of a kilo of potatoes has increased by 28 in the same period The price of two pints of milk has risen by 33 per cent and a kilo of sugar has risen by 47 per cent, while it is welcome that the overall rate of inflation has fallen these figures show there is absolutely no room for complacency In the battle against inflation food price inflation is still worryingly high, we now know we have to stick to the plan to reduce inflation because it is causing enormous pressure on families across the country.

Raising interest rates will mean higher mortgage

cost

s for many homeowners, but today's numbers mean there is now another increase. on the cards I think the Bank of England, looking at today's data, will think that this points to the need to raise interest rates again and because, although the headline rate has fallen, the central measure of inflation, somewhat endemic throughout the economy, it is still accelerating. So they will want to take more action, the inflation rate may be falling and the price of so many goods continues to rise, the pain for households and businesses is far from over.

Well, Layla joins us now in the studio, so Layla, another interest rate increase. could be on the horizon we've had 12 of them in a row now our economists are confident this is the right strategy well not all economists agree with the bank's strategy right now historically interest rate increases work they help control inflation by making it more expensive to borrow money and encouraging us all to spend less, the problem is that it takes time to work and many economists argue that if you raise interest rates too much it slows down the economy even more, so it is a difficult balancing act for the Bank of England and the fact is that inflation has not fallen as fast as many expected or predicted so let's summarize today's

news

but I'm afraid there is a long way to go, well Leila, thank you.