Inflation: Soaring bread and meat costs push prices back to 40-year high

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The cost of living went up to a 40-year high in July due to soaring food prices.

Inflation increased to 10.1% in September as rising living costs continued to impact household budgets.

The biggest jump in food prices since 1980 was shown by official figures.

According to the Bank of England, inflation could peak this year.

In the year to September, the Consumer Prices Index inflation hit 10.1%, after dipping to 9.9% in August.

Economists had expected a figure of 10%.

The rise was caused by higher energy bills.

The cost of furniture and hotel stays went up as well as the food and drink prices.

After last month's small fall, headline inflation returned to its high seen earlier in the summer.

"These rises were partially offset by continuing falls in the costs of petrol, with airline prices falling by more than usual for this time of year, and second-hand car prices also rising less steeply than last year."

New Chancellor Jeremy Hunt is trying to tackle the rising cost of living as well as the recent turmoil on financial markets caused by his predecessor's mini-Budget.

At a time when energy and food bills are also rising, mortgage prices have hit a 14-year high, driving up costs for millions.

Mr Hunt said the government would prioritize help for the most vulnerable and deliver economic stability.

The Bank of England will be under pressure to raise interest rates at its next meeting in November, according to experts.

The Bank wants to encourage people to save more and spend less in order to stop rising prices. Since December, it has increased rates seven times, trying to bring inflation down to 2%.

Higher rates drive up borrowing costs for businesses and mortgage holders, with experts warning that this could affect economic growth.

Victoria Scholar, head of investment at Interactive Investor, said that the Bank was between a rock and a hard place.

She said that inflation was the most pressing economic problem facing the Bank of England.

She said that without price stability the cost-of-living crisis will continue to weigh on the economy.

Next April's rise in the state pension and increase in some benefits will be calculated using September's inflation figures.

It's not clear if the government will stick to this policy or if it will cut spending by linking the rise to wages.