Academy Of Ideas

Recording of an Academy of Ideas debate on Tuesday 28 June 2022. INTRODUCTION Around the world, prices of a wide range of goods and commodities have been rising sharply for the past few months. In particular, the wholesale cost of energy has been rising fast as the world economy recovered from the pandemic restrictions. Petrol prices have risen by almost a third in the past 12 months. The UK domestic energy ‘price cap’, which hit a low of £1,042 in 2020, is expected to rise to £2,800 in October. Consumer price inflation has hit 9% and is likely to reach 10% by the end of the year. For those on lower incomes, who spend more of their income on food and energy, the impact is even greater. There are multiple explanations for the rises: the post-pandemic recovery and problems with shipping have been widely cited. The war in Ukraine and sanctions against Russia are hitting energy and food prices. Many economists also point to the rise in the money supply – thanks to ultra-low interest rates, quantitative easing and