How is inflation calculated? All you need to know about measurements after UK inflation rises to 9%
Official figures have revealed the rate of inflation is at its highest in 40 years, but what does it mean?
This rise is calculated over a 12 month period and is up from 7% in March.
But what does this mean, and how are these numbers worked out?
At its simplest, inflation is an increase in the cost of everyday goods and services which households spend money on.
As a simplified example, if a loaf of bread cost £1 12 months ago, it now costs £1.09.
Within economics, it is expected for prices to rise over time, but any rapid rise in the speed of inflation can hit the public hard financially.
The major calculation of inflation is known as the Consumer Price Index, which measures the percentage change in the price of a series of goods and services.
These are weighted according to their perceived importance, with housing being given the most weight within the algorithm and communication services such as broadband and mobile phone contracts being given the least.
The prices are collected from a range of online and high street retailers, supermarkets and department stores where households shop in addition to government authorities when considering costs such as taxes, energy providers and estate agents.
What does rising levels of inflation mean for regular people?
For a while now, rising wages have not been able to keep up with the rising costs of services, meaning budgets will continue to be stretched.
The Consumer Price Index is not the sole indicator of the cost of living, rather offering a way to calculate inflation which is then used to calculate the cost of living.
What can I do to fight inflation?
There is very little households can do as they are already feeling the effects of the rise in the cost of living. The Bank of England may look to make borrowing more expensive to encourage the public to save money.