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Why are prices rising faster than inflation?

3 replies

EightChalk · 15/10/2022 12:36

Apologies if this has been explained before. I don't understand why prices of food and other groceries are rising much more than the rate of inflation. Seeing 20%, 30% or even higher percentage increases on products I buy regularly isn't uncommon now. What is the rate of inflation useful for, if prices don't actually reflect it?

Like many people, I'm so scared about prices just going up and up (having read doom-mongering posts about how it will only get worse over the next 12 months... I'm only just barely coping now, I won't be able to afford to live if things keep going up in the way that they are now), and there doesn't seem to be any meaningful way to predict it, at least in terms of actual amounts or when it might end.

OP posts:
Haus1234 · 15/10/2022 12:39

The published rate of inflation is a measure of the average price rise of a “bucket” of goods - this includes your items with 20% price rises but also includes items with lower rises so the average is more like 10%. It’s also on a bit of a lag because it takes a bit of time to measure stuff.

nannynick · 15/10/2022 12:39

I think some is due to shortages of food globally... poor harvest, War, rises in cost of production.

Cost rises in building rents, heating, electricity, staff wages.

Drops in investment returns.
Everything is having an affect on the costs we pay.

SarahR2022 · 16/10/2022 10:13

The inflation figures quoted by the government (CPI) are heavily manipulated....they regularly substitute products for cheaper ones to keep the figure down....real inflation is therefore much higher than CPI....if people really knew what went on behind the scenes there would be riots....

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