Wednesday evening news briefing: How Bank failed to grip inflation

·7 min read
Your evening briefing from The Telegraph
Your evening briefing from The Telegraph

After weeks of dry weather, heavy rain has hit large parts of the UK (central London's Millennium Bridge is pictured below) and caused flooding. Plus, we analyse how the Bank of England has failed to get a grip on inflation.

Evening briefing: Today's essential headlines

UK floods | The Met Office has warned of dangerous floods that are set to hit parts of the UK, amid thunderstorms lashing the country after weeks of dry weather.

Video showed central London station staff in ankle-deep water today as heavy rain hit the capital.

Across the world, the lack of rain has seen submerged wonders rediscovered, from Second World War shipwrecks to medieval bridges. In Iraq, pictures show how the reputed home of the Garden of Eden has been turned into a "desert".

People with umbrellas walking in the rain on Millennium Bridge, London, this afternoon - Victoria Jones /PA
People with umbrellas walking in the rain on Millennium Bridge, London, this afternoon - Victoria Jones /PA

The big story: Prices rise faster than Bank predicted

Two weeks ago, Andrew Bailey set out to sound tough on price rises. But, as the Governor of the Bank of England raised interest rates in the biggest increase in borrowing costs for more than 25 years, little did he know that inflation was already accelerating faster than had been predicted.

Figures released this morning show that it rose into double figures for the first time in 40 years last month to 10.1pc.

Unveiling Threadneedle Street's latest forecasts, Mr Bailey set out a vision of inflation rising to above 10pc later this year, peaking at 13.3pc before dropping back sharply in late 2023 and early 2024.

But with price rises already well above the Bank's forecast level, there are growing signs inflation could linger for longer than the Governor hopes, despite his efforts with higher rates.

Deputy economics editor Tim Wallace explains how rampant inflation is running further away from officials.

Today’s announcement brings a triple whammy for house prices. Plunging real wages are hitting the pockets of both buyers and homeowners, as the ability of many to afford a mortgage is drastically reduced.

Melissa Lawford says the housing market slowdown has already begun, as she explains everything you need to know.

Meanwhile, experts have warned that a failure to provide support for struggling homeowners will trigger a "tsunami of repossessions". In other news on a day in which the cost-of-living crisis tightened further still:

What will new PM do?

Dealing with the deepening cost-of-living crisis will be very high on the agenda of the next prime minister when he or she takes office in less than three weeks.

After accusations that both candidates – Rishi Sunak and Liz Truss – have failed to lay out detailed enough plans, both would-be Tory leaders took questions from party members at the eighth of the 12 hustings of the race to Number 10.

Mr Sunak reiterated his pledge to bring forward more direct support for the most vulnerable in society if he becomes prime minister, while a leading supporter of Ms Truss said she recognises "a lot more will have to be done" to help households.

Have your say

It is a sign that people are tightening their domestic budgets. Almost 600,000 British households cancelled their Amazon Prime subscriptions ahead of a price rise as the cost-of-living crisis hits streaming companies.

But what other changes are Telegraph readers making to their monthly outgoings in the midst of surging inflation? Are you rethinking your shopping habits – and what changes are you making?

Email a short message to yourstory@telegraph.co.uk, along with your name and Front Page in the subject line for the chance to be included in an article.

Comment and analysis

Around the world: Missile attack on strategic Odesa

Russian forces have launched missile attacks on the Black Sea region of Odesa, a key location for the export of grain. Local officials said that damage had been caused by two enemy rockets, with several people killed. Follow the latest updates in our live blog. Ahead of Russia's International Military Technical Forum near Moscow, a Russian soldier has been pictured preparing a "brain test" on a military student.

Wednesday interview: Gary Lineker exclusive – 'You have to be so careful – people will pounce on you'

Following a glittering playing career, Gary Lineker stepped into broadcasting. He speaks to Jason Burt about the ups and downs – and defends the BBC axing classified football results. Read the interview

Gary Lineker
Gary Lineker

Sport briefing: Murray vs Norrie – live

Andy Murray, the British No 1, is facing three-time grand slam champion Cameron Norrie in Cincinnati at the Western and Southern Open. Follow live updates with Greg Wilcox. Meanwhile, England suffered a torrid morning after losing the toss at Lord's before the first Test against South Africa, who led the World Test Championship until rain stopped play this afternoon. Ben Stokes is described by chief cricket correspondent Nick Hoult as ranking as England's most powerful captain in generations. And, in the latest edition of the Vaughany & Tuffers Cricket Club podcast, Sir Geoffrey Boycott talks about the perils of "Bazball".

Editor's choice

  1. What to do with a glut of blackberries | Delicious dishes and drinks to make

  2. Death of Darius Danesh | Why Pop Idol contestant was the ultimate Noughties star

  3. De facto national carrier | The 11 things you need to know about Ryanair

Business briefing: Cineworld forced into crisis talks

Aside from today's main Business story on inflation, shares in cinema giant Cineworld have plunged to a record low after it warned a lack of big film releases this year will hammer ticket sales and could force it into a rescue deal. The world's second largest cinema operator said recent admission levels had proved disappointing. Hannah Boland reports that the company is in talks with shareholders over potential restructuring.

Tonight starts now

Results day guide | A-level results day tomorrow can be stressful for everyone involved. As a parent, knowing how to support your teenager whatever the outcome can make a real difference. Research has found that a third of sixth formers said their parents added to their stress levels on results day. Hannah Morrish has parental advice on the dos and don'ts of how to deal with a child who does not get their desired grades. And this guide explains how Clearing can offer a second opportunity.

Three things for you

And finally... for this evening's downtime

Pain in the tooth | With the NHS in the grip of a dentist crisis, could dental tourism really be the only option for toothache prevention? Jamie Fullerton explains how he got five fillings in Nepal – and offers five pointers for anyone considering doing the same.

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