The Mail reports: The typical family has been stung by an increase of £54 a week in their bills over the past six months, alarming research reveals today.
The report, from the comparison website Moneysupermarket, highlights the pressure on households on all fronts from petrol prices to energy bills.
Kevin Mountford, the website’s head of banking, said: ‘Many families will feel like their finances are approaching breaking point.’
It comes as official figures, published yesterday, show inflation surged to 4.5 per cent last month, the highest level since October 2008 and more than double the Government’s 2 per cent target.
It means homeowners could be hit by interest rates rises imminently, meaning their monthly mortgage payments will jump if they do not have a fixed-rate loan.
The figures, from the Office for National Statistics, expose crippling price rises, including air fares being 29 per cent higher in April than in March.
This is because airlines and travel agents ruthlessly hiked their prices to take advantage of the anticipated increase in demand during the double bank holiday weekend bonanza, which included the royal wedding.
At the same, time, the price of alcohol and cigarettes jumped by 5.3 per cent, the highest-ever monthly increase since records began 15 years ago.
By comparison, a typical worker’s pay is either being frozen, or is rising by a paltry 2.5 per cent.
They are also being hit by tax rises, such as VAT and National Insurance, and changes to benefit entitlements.
The Moneysupermarket research said petrol, food and energy bills are causing the biggest headaches for families.
Further pressure is on its way, with the Bank of England predicting inflation will keep on rising, with energy bills set for double-digit increases.
Angela Eagle, Labour’s Treasury spokesman, said: ‘Across the country, millions of people on low and middle incomes are being squeezed in every direction by rising prices made worse by the VAT rise.’
A rate rise would be a devastating blow for millions of homeowners who are already struggling to afford their monthly repayments.
The Bank of England has kept the base rate at an historic low of 0.5 per cent for more than two years, but a rate rise is widely expected later this year.
Howard Archer, chief economist at the consultancy IHS Global Insight, warned of the rise in inflation: ‘It is likely to significantly boost expectations that the Bank will act as soon as August.’
Yesterday business lobby groups and many economists urged the Bank to resist the temptation to increase the base rate.
David Kern, chief economist at the British Chambers of Commerce, said: ‘We expect to see interest rates increase later in the year.
‘But we urged the Bank’s Monetary Policy Committee to hold its nerve in the short-term to allow the economy to grow while absorbing the initial impacts of the measures to tackle the UK’s deficit.’
John Walker, national chairman of the Federation of Small Businesses, said: ‘The economy is not in a strong enough position to withstand an interest rate rise at present.’
For savers, low rates have been a major problem, with the income from their nest eggs slashed by rates as low as 0.01 per cent.
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