Key points
- New energy price cap set at £2,074 from July
- What should you do now?
- Jeremy Hunt doesn't rule out further energy support
- Bill payers warned they won't save money this winter
- Interest rate forecasts rise significantly in recent days|Ed Conway explains why and what it means
- Who's making money from rising food prices?
- Your dilemmas:I am paying my dad's mortgage, how do I get added on formally?
- Budgeting Mum:Saving for your children|Do food subscriptions save you money?|Holiday spending money|Best broadband deals
- Live reporting by Jess Sharp and Katie Williams
How will the new energy price cap affect electric car owners?
As we've been reporting, a reduction to the energy price cap has been announced today and will come into force from 1 July.
It will mean the average household in England, Wales and Scotland, will see bills fall by £426.
So what will it mean for electric car owners, who arguably use a lot more electricity.
Well the £1,206 reduction from £3,280 to £2,074 will be positive news for drivers of electric vehicles, as it means anyone on a standard domestic energy tariff will pay less than £20 to fully charge a typical family sized car from home.
Those on EV-specific electricity tariffs who benefit from cheap off-peak rates will continue to enjoy even better value.
However, for those travelling beyond the range of their vehicle and rely on rapid and ultra-rapid chargers, the cost is much higher, RAC spokesman Rod Dennis said.
A 20% VAT is applied to these charge points - which is 15% more than the VAT applied to domestic electricity.
It's important to remember the energy price cap does not set the maximum a household will pay for their energy but limits the amount providers can charge them per unit of gas or electricity, so those who use more energy will pay more.
Octopus Energy set to bring back Saving Sessions scheme this winter
Smart meter customers with Octopus Energy are set to make savings by cutting back on their electricity use again this winter.
The company is planning to bring back its Saving Sessions scheme which saw households switch lightbulbs for candles during the 2022-23 winter to save money on their energy bills.
The initiative rewarded customers for every unit of energy saved during peak periods.
Octopus said the scheme shifted 1.86GWh (gigawatt hours) of energy demand across 13 sessions - the equivalent of stopping two million washing machine runs.
Nearly 700,000 smart meter customers took part, with £5.3m paid to participants over the duration of the scheme.
Over £170,000 worth of these earnings were donated by customers to Octopus' hardship fund for struggling families, it said.
The news comes after regulator Ofgem announced a drop in the energy price cap on household bills from July.
Greg Jackson, Octopus founder, said the move guarantees falling global energy costs will be passed on to consumers.
"However, costs are still twice as high as they were pre-crisis," he added.
"We'll do all we can to help customers through this crisis, and hope that the government will also continue to help those who need it most."
Summer 'travel chaos' warning as Edinburgh Airport workers back strike action in pay row
Passengers could face a summer of "travel chaos" after Edinburgh Airport workers voted to take strike action in a dispute over pay, a union has warned.
Uniteballoted around 275 workers, including members employed in security, terminal operations and search areas.
It said 85% backed industrial action on a 75% turnout, and is now calling on airport bosses to tender an improved offer to "avert travel chaos" during the summer.
Read more from ourScotland reporter Jenness Mitchellhere...
Workers at soft drink plant to strike over pay
Hundreds of workers at a soft drinks plant are to strike in a dispute over pay.
Unite members at the Coca-Cola Europacific Partners (CCEP) site in Wakefield will walk out for a series of strikes from 8 June.
The workers voted overwhelmingly in favour of industrial action over a pay offer which the union said was worth an average of 6%.
There would be 14 days of strike action, comprising three 48-hour strikes and two 96-hour strikes, spaced over a two-week period.
"Coca Cola Europacific Partners is making profits in the billions but it's delivering a pay cut to the very workers who are making them," Unite general secretary Sharon Graham said.
How the new energy price cap will affect our bills
The squeeze on energy prices will ease from July when we're expected to see a difference in what we pay to keep our homes running,business correspondent Paul Kelsosays.
Wholesale energy prices began rising at the end of 2021, with the increase exacerbated by Russia's invasion of Ukraine in February last year.
High energy costs made fuel poverty a "mainstream experience" and "pushed millions of families into stretched budgets", Kelso says, despite the government mitigating the impact with its energy support scheme during the winter.
But what will happen in July?
The cost to suppliers of buying energy has fallen to its lowest level since 2021, Kelso explains, but this reduction won't be felt by customers until the summer as companies buy up their supplies in advance.
And though prices have stabilised, bills are still more than double where they were two years ago, he adds.
Watch Kelso's full explainer on what today's energy price cap announcement means for our bills here...
Heathrow security guards stage fresh strike over pay
Security guards at Heathrow Airport have launched a three-day strike today in a dispute over pay.
Members of Unite have already held 15 days of industrial action, including over the busy Easter period.
Heathrow said it had contingency plans in place to keep the airport open and operating as usual, adding that passengers could expect to have a "smooth" half-term getaway.
"Passengers should not be concerned about strike action by Unite over the half-term getaway," Heathrow chief executive John Holland-Kaye said.
"These strikes are completely unnecessary. When I speak to colleagues the overwhelming message is that they just want to vote on our pay offer, but Unite won't let them."
Unite said Heathrow security officers were paid less than workers at other major airports in London and the South East.
Fuel prices have fallen this month - here's how much it will cost you at the pump
Fuel prices have fallen again after dipping below 145p last week for the first time in 18 months.
The average price of a litre of unleaded is now 143.35p, down from 146.89p last month, according to the RAC Fuel Watch.
This means a typical 55-litre family car will now cost £78.84 to fill up.
Diesel sits at 154.31p per litre, down from 161.06p in April, meaning the same sized car will set you back £84.87 for a full tank.
While the prices have been consistently falling, RAC spokesman Rod Dennis says petrol costs "might bottom out over the next few weeks".
Saudi Arabia and other OPEC+ oil producers are planning to cut oil output to around 1.16 million barrels per day, which Mr Dennis says we could see petrol prices "head up slightly".
For diesel, he says it remains "massively overpriced" across the country, despite wholesale prices being cheaper than unleaded.
The wholesale prices of the two fuels had been virtually identical in previous months, but petrol has been creeping up to at least 5p more per litre.
Smaller lenders pull mortgage deals over interest rate concerns
A jump in UK borrowing costs over the last 48 hours has forced smaller British mortgage lenders to temporarily withdraw deals and reprice offers for new customers.
UK gilts have risen sharply yesterday and today (to their highest level since after the disastrous mini-budget last year) after inflation figures showed price rises are not easing as quickly as hoped - leading to forecasts that interest rates will have to rise again.
Central banks raise rates so people have less money to spend, and save more, which tends to curb inflation.
As Ed Conway explained in our 6.43am post, the Bank rate could now peak at 5.5% this year - last week the expectation had been 4.75%.
Now, Reuters reports that at least seven small lenders have pulled products or announced a repricing this week.
These lenders are mostly focused on the buy-to-let market - and none of them are major high street banks.
Car production increases for third month in a row
Car production has increased for the third month in a row as shortages of supplies continued to ease, new figures show.
A total of 66,527 cars were made in April, an increase of almost 6,000 on the same month last year, said the Society of Motor Manufacturers and Traders (SMMT).
Exports drove production, rising 14.7% to 54,820 vehicles, with more than four out of five cars built in this country heading overseas.
The European Union remained the most important global market, taking 58% of all exports, followed by the US, China and Australia.
Hybrid electric (HEV), plug-in hybrid (PHEV) and battery electric vehicles (BEVs) represented more than a third of all production.
Savings deals of the week
Moneyfactscompare.co.ukexpert Rachel Springall has published her savings deals of the week.
Chip – Instant Access powered by ClearBank
"Chip has increased the rate on its Instant Access powered by ClearBank product to 3.75% this week, improving its position in the market. Savers searching for a competitive rate on a flexible savings account may find this deal attractive as it allows unlimited withdrawals. Savers should be aware that they need to hold a Chip subscription (for which both free and paid options are available)."
Minimum opening amount: £1
Investec Bank plc – 1-Year Fixed Rate Saver
"Now paying 5.00%, the deal has improved its position within its sector against its peers and may be an attractive choice for savers looking to lock their money away for a year for a guaranteed return."
Minimum opening amount: £5,000
UBL UK – 1 Year Fixed Rate Cash ISA
"Now paying 4.35% on maturity, savers may find this an attractive choice if they have yet to use their ISA allowance, but they must be comfortable with their initial investment as further additions are not permitted."
Minimum opening amount: £2,000
Gatehouse Bank – Easy Access Cash ISA
"Savers who want flexibility with their ISA cash may find the latest rate rise by Gatehouse Bank appealing. The deal now pays an expected profit rate of 3.55% and improves its position within the top rate tables in its sector. The account offers a monthly expected profit option, which may appeal to savers looking to supplement their income."
Minimum opening amount: £1
NatWest – 2 Year Fixed Rate ISA Issue 323
"This week, NatWest has increased the rate on its 2-Year Fixed Rate ISA, which now pays 4.50%. The deal takes a more prominent position within its sector against its peers and may well attract savers who plan to use their tax-free ISA allowance. Savers who are happy to lock their cash away until 2025 can make further additions until a certain date, which may appeal to those who may have extra cash to invest or transfers in."
Minimum opening amount: £1,000
FAQs
What is the UK doing about the cost of living crisis? ›
The government has responded to the crisis with several packages of support throughout this and last year. In 2022/23 household income support totalled £59.8bn. Office for Budget Responsibility, Economic and fiscal outlook, March and November 2022.
Will the cost of living go down UK? ›The Office for Budget Responsibility is warning of a big drop in living standards over the next two years. Once inflation is taken into account, household disposable income is set to fall by 5.7% between 2022 and 2024. That is the largest two-year fall since records began in the mid-1950s.
Has the cost of living gone up in England? ›The cost of living has been rising in recent months in the UK and across the world.
Why is the cost of living so high? ›California is so expensive because of its strong economy, high-income tax rates, and limited housing supply which make it difficult for residents to save money. Moreover, the prices of basic necessities such as food, gasoline, and transportation are comparatively steep in California as compared to most other US states.
Why is Britain facing a cost of living crisis? ›This is caused in part by a rise in inflation in the UK, as well as the economic impact of ongoing issues such as the COVID-19 pandemic, Russia's invasion of Ukraine, and Brexit. While all in the UK are affected by rising prices, it most substantially affects low-income persons.
Why is UK cost of living so high? ›Pandemic-related supply shortages were a major factor. As the global economy recovered from its pandemic-related recession, there was increased demand for products and materials. The conflict in Ukraine also led to higher commodity prices (mainly in the first half of 2022), pushing up inflation around the world.
Is it more expensive to live in England than the US? ›The USA is the winner in terms of having lower overall costs compared to the UK.
Is the US more affordable than the UK? ›Key Takeaways. Overall, the cost of living in the U.K. is 0.49% lower than in the United States. Rent overall is about 22.55% lower in the U.K. You would need $4,700 per month to finance a modest lifestyle in London, compared to $5,822 for the equivalent lifestyle in New York City.
Are UK house prices unaffordable? ›The average British home now costs about nine times average earnings: one estimate I recently read reckoned that the last time UK houses were this expensive was in 1876.
Why is UK inflation so high? ›Britain has struggled more than other countries with the surging cost of food, a shortage of workers to fill jobs and its heavy reliance on natural gas to generate power and domestic heating, all of which adds to inflation pressure.
Why is UK inflation higher than Europe? ›
Gas prices
Rising energy prices hit UK households and businesses hard - harder than in other European countries. According to Reuters, Britain's high rate of energy inflation shows it's over-reliant on gas for heating homes. It also reflects the poor energy efficiency of its housing stock.
Typical UK household spends about £3,601 on groceries and £1,744 on meals at restaurants and takeaways yearly. Between June 2021 and June 2022, food prices increased by 9.9%, mainly due to rising costs of labour, energy, fuel, and transportation.
Does the U.S. have a high cost of living? ›States With Highest Cost of Living
The ten states with the highest cost of living are Hawaii, Massachusetts, California, New York, Alaska, Maryland, Oregon, Connecticut, New Hampshire, and Vermont. Hawaii is the state with the highest cost of living in the US, with a cost of living index of 184.
The pandemic and the supply chain crisis have pushed the cost of virtually everything higher. Food and cars are more expensive, as are transport and labor costs, making inflation the buzzword of the moment. In February, consumer prices increased at a level not seen since the start of 1982.
Is New York or California more expensive? ›Which City Is More Affordable: Los Angeles or New York City? Both NYC and LA are among the most expensive cities in both the U.S. and the world. However, the average cost of living in LA is also 24-27% lower than that of NYC.
Is USA affected by cost of living crisis? ›For instance, the inflation rate in the United States has hovered between 8 and 9 percent in the past months, signifying a rising cost of goods across the country. A rising cost of living causes pain even in wealthy countries.
Is inflation worse in the UK than elsewhere? ›"Inflation in the UK has risen further and stayed higher than elsewhere as the UK has experienced the worst of both worlds: a big energy shock like the euro zone and labour shortages - even worse than the U.S.," said Ruth Gregory, deputy chief UK economist at consultancy Capital Economics.
Why is Britain's economy suffering? ›Britain has suffered a decline in employment since the Covid-19 pandemic, fuelled by rapid growth in economic inactivity – a term used by statisticians to define when working-age adults are neither in a job nor looking for work. Older workers have retired early and there have been record levels of long-term sickness.
Is food cheaper in America than UK? ›Cost of Food
Generally speaking, the USA tends to be a little more expensive when it comes to grocery shopping. Bread, rice, and many fruits and vegetables are mostly less expensive in the UK. However, keep in mind that foods such as milk, chicken breasts, and eggs will cost you between 20-40% more in the UK.
- Durham, North East England. Durham is located in northeast England, south of Newcastle upon Tyne. ...
- Belfast, Capital of Northern Ireland. Belfast is the capital of Northern Ireland, and it was also where the RMS Titanic was built. ...
- Leicester. ...
- Stirling. ...
- Lancaster. ...
- Cardiff. ...
- Newcastle. ...
- Coventry.
Why are things more expensive in UK than us? ›
Tax rates are important for goods like alcohol, petrol and cigarettes with UK tax rates higher than European / US rates. However, although the UK is expensive in some areas, in other areas it is cheaper. e.g. US is much cheaper to eat out, but in US you have to pay private healthcare insurance.
Is it better to live in the UK or USA? ›Generally, the UK offers more vacation time and a balanced work-life balance, while the US has a more competitive job market and longer working hours. Lastly, taxes differ between the two countries. The UK has a higher tax rate overall but also offers a wider range of social welfare programs.
Can I live in England as an American? ›Contrary to popular belief, you need a visa to move to the UK if you are an American citizen. The only exception to this is that if you are visiting with no long-term plans, you can stay in the UK without a visa for six months – but you cannot work during your visa-free stay.
Is it cheaper to live in Ireland or the US? ›At a country level, the cost of living in Ireland, including housing, is only 10% lower than the cost of living in the USA.
Are US taxes higher than UK? ›The highest rate of income tax in the US is 37% if you earn over $523k. In the UK, it's 45% if you earn over £150k. In many US states, you also have to pay state taxes - some states pay nothing, but New York, for example, the state taxes can be an additional 8.8%. Nothing like that in the UK.
Which country is richer between UK and USA? ›World Wealth: Britain crowned fifth richest country in the world behind US, China, Japan and Germany. The UK has been crowned the world's fifth richest country in the world in a new report that measures the total wealth amassed by each country's individuals.
Why are houses cheaper in USA than UK? ›Plus, America's housing stock tends to be newer because it is a younger country. Thus, it is built to a higher specification. The average American house is three times the size of a British one. So you can get a house that would be considered large in Britain, for less than the average British house price.
Should I buy a house now or wait until 2023 UK? ›For many, even a small slow down in house price growth will make getting on the ladder more affordable, making 2023 the year to buy. If you are thinking of making the leap to homeownership, it's worth getting in touch with a mortgage broker to find the best option for you.
Why are UK houses so overpriced? ›Supply and demand, land prices and planning laws. The UK doesn't build enough houses, so houses are more expensive. The UK is a lot smaller than other comparable countries eg. the USA, Canada, Australia, so land is more scarce and thus more expensive.
What is the house crisis in the UK? ›Compared to the average European country, Britain today has a backlog of 4.3 million homes that are missing from the national housing market as they were never built. This housing deficit would take at least half a century to fill even if the Government's current target to build 300,000 homes a year is reached.
Is the UK struggling with inflation? ›
Britain was the only country in Western Europe with double-digit inflation in March, and it has not had more than three consecutive months of slowing price increases since hitting a 41-year high of 11.1 per cent in October. Analysts now fear interest rates could be heading towards 5 per cent.
Has inflation ever been negative in the UK? ›After the inflation of the First World War, the UK experienced deflation (falling prices) during the 1920s and early part of 1930s. This deflation was due to tight monetary and fiscal policy and an overvalued exchange rate (Gold Standard).
What is the highest inflation ever in the UK? ›The inflation rate for consumer prices in the United Kingdom moved over the past 62 years between 0.4% and 24.2%. For 2022, an inflation rate of 7.9% was calculated. During the observation period from 1960 to 2022, the average inflation rate was 5.2% per year. Overall, the price increase was 2,052.01%.
What is the inflation rate in the US vs UK? ›International comparisons. On a headline basis, inflation is higher in the UK than elsewhere. In the eurozone, annual inflation slowed to 8.5% in February, down from a peak of 10.6% in October, while US inflation eased to 6% last month, a fall from a high of 9.1% last summer.
What is the inflation rate in the UK compared to the US? ›Britain's headline inflation rate is now the highest in western Europe and compares with an average of 6.9% in the euro zone and 5.0% in the United States.
Does Europe or US have higher inflation? ›Demand-Pull Inflation vs. European Cost-Push Inflation. Core inflation, which excludes volatile energy and food prices, has been significantly higher in the U.S. than in Europe. Higher core prices are notable because economists generally consider core inflation data a better predictor of more persistent inflation.
How much is an average dinner in England? ›The study showed that on average Brits eat out 1.5 times a week, spending up to £53 ($83) per meal. That equates to roughly £4,166 ($6,523) spent dining out, or 25% of the average annual income.
How much is a dozen eggs in England? ›Egg prices decreased to 83.9p per dozen, a 4.3% fall on Q4 2021 price; 3.6% lower than Q4 2020.
How much is a pub meal in England? ›Currently, for mainstream pubs, the average starter price is £6.35 – up from £6.31 compared to the previous year, a main is £11.87 – up by 1.1% from 2020, sides prices dropped slightly by 0.2% to £2.74 from £2.75 and desserts saw a rise of 1.3% to £5.46.
What is the most expensive state to live in the US? ›The ten most expensive states to live in are Hawaii, Massachusetts, California, New York, Alaska, Maryland, Oregon, Connecticut, New Hampshire, and Vermont. Hawaii is the most expensive state to live in, with a cost of living index of 184.
What is the most unaffordable state to live in? ›
The most expensive state to move to in 2023 is Hawai'i, with an average home price of $636,400.
Is the US the most expensive country to live in? ›Unsurprisingly, Switzerland is one of the most expensive countries to live in. The country's cost of living index was ranked the highest in the world in 2020 at 122.4. For comparison, notoriously costly New York City has a cost-of-living index of 100.
Why is everything in the US so expensive? ›Inflation is so high because many consumers are spending more money than they usually do, and because supply chain issues and global fuel shortages have lingered since the pandemic. That high demand and low supply have led to an increase in prices.
Why is it expensive to be poor in America? ›Low-income Americans spend over 80% of their income on necessities. That leaves little or no cushion when things go wrong. Housing, food, and transportation dominate spending. Housing, in particular, represents over 40% of an average low-income budget.
Will food prices go down in 2023? ›Food prices are projected to rise in 2023, albeit at a slower pace than they did in 2022, according to the USDA.
What is the most expensive place to live in the world? ›Singapore and New York City tied for the first rank amongst the world's most expensive cities in 2022, pushing Israel's Tel Aviv from the first place in 2021 to the third place in 2022.
Which state is more expensive California or Florida? ›For starters, the cost of living is drastically cheaper in Florida. California ranks as the second most expensive place to live in the country so those who move from California will find real estate prices much more affordable in Florida. Not only is Florida more affordable, but there are more jobs to be had.
What is the most expensive city to live in? ›Tied with New York, Singapore often tops the list.
How do I prepare for cost of living crisis UK? ›- Contact your university about hardship funds. ...
- Ask for a pay rise at your part-time job. ...
- Get a heated blanket for winter. ...
- Look into scholarships, grants and bursaries. ...
- Try ways to make money from home. ...
- See if your parents can offer any financial support.
Food retailers have said they expect prices to rise in 2023 overall but with the rate of inflation declining through the year and some products which have seen the sharpest rises falling in price.
What is causing the inflation rate in the UK? ›
Why are prices rising so fast? The soaring cost of food and energy have been key drivers of inflation. Oil and gas were in greater demand as life got back to normal after Covid. At the same time, the war in Ukraine meant less was available from Russia, putting further pressure on prices.
What will be the cost of living expenses in UK? ›Miscellaneous Expense
These expenditures vary from person to person depending upon their personal lifestyle. Therefore, you should plan your monthly budget accordingly. Miscellaneous expenses can range from INR 40000 to 50000.
Updated on 21 May, 2023
The average cost of living as a family of four is around $3,135(£2,268) without house rent. As a single person or student, the estimated cost of living per month in the UK is $900(£651) without rent.
2023 is shaping up to be a difficult year when it comes to food shortages. However, the food shortage in 2023 isn't the end of the world, especially if you work with a wholesale food supplier.
How bad will food shortages be in 2023? ›The WFP predicts that by 2023 there will be a shortage of wheat and corn, which are two staple products in the food supply chain. The reports also estimate that these global food shortages will increase food prices and could even trigger a new global recession.
Will grocery prices go down in 2023? ›Food prices are expected to grow more slowly in 2023 than in 2022 but still at above historical-average rates. In 2023, all food prices are predicted to increase 6.5 percent, with a prediction interval of 4.9 to 8.2 percent.
Why is inflation worse in UK than Europe? ›The figures underscored the risk that Britain suffers high inflation for longer than other similar economies due to its reliance on natural gas for heating and electricity and the structure of state subsidies to smooth out price changes.
Does the UK have the worst inflation? ›Britain has shot up the leader board and now has western Europe's highest rate of consumer price inflation.
Is UK inflation higher than Europe? ›As the Bank of England hikes interest rates to keep prices in check, the UK's inflation rate remains worse than the EU's. Here's why. The Bank of England has raised UK interest rates by a quarter of a percentage point to 4.5 per cent – the highest level since 2008.
Why has everything gone up in price UK? ›Prices have increased over the past 12 months by 8.7% on average, putting pressure on already stretched household budgets. The increase is driven mainly by rising food costs, partly a result of the nation's salad shortage, as well as the cost of some household items.
What is the Canadian inflation rate today? ›
Current Canada Inflation Rate: 4.4%