Inflation — is lower in Brexit Britain than in the EU

Food, glorious food — The EU’s (and BBC’s) cost of living crisis

The most commonly used measure of inflation shows that things are worse in the EU

When the latest inflation figures came out on Wednesday (22 June 2022), many of ‘the usual suspects were quick to insinuate that Brexit was to blame — at least in part. Those who made international comparisons — such as the BBC — failed to show that the EU has even worse problems. However when you analyse the UK’s results and compared them to the picture across the EU. The results are very interesting indeed

The ONS “CPIH is my preferred measure of consumer price inflation” — so that is what I have used.

Consumer Prices Index including owner occupiers’ housing costs (CPIH)

Annual increase — latest figures released for May 2022

• UK 7.9%
• EU 8.8%

[Sources: UK Office for National Statistics (ONS) and EU statistics agency (Eurostat)]

How did the BBC cover this story?

On Wednesday the BBC’s coverage of inflation figures focused on the cost of food.

Here is their opening paragraph:-

“Prices are continuing to rise at their fastest rate for 40 years with food costs, particularly for bread, cereal and meat, climbing.”

- BBC, 22 June 2022

Whilst the BBC made international comparisons in its report, strangely it did not mention the EU.

I am therefore happy to put this right for them.

The figures below show one essential element in the rising cost of living: that of food prices, as this was specifically highlighted by the BBC, amongst others.

The price of a loaf of bread — and all other food and non-alcoholic drinks

Annual increase — latest figures released for May 2022

• UK 8.7%
• EU 10.0%

Sources: UK Office for National Statistics (ONS) and EU statistics agency (Eurostat).]

General explainer — How is inflation measured these days?

There are now three different measures of inflation: Household Cost Indices (HCIs) saw similar inflation rates as the Consumer Prices Index (CPI) and the Consumer Prices Index including owner occupiers’ housing costs (CPIH) at the end of 2021, reflecting common drivers of inflation.

All three measures of consumer price inflation have seen sharp rises since March 2021. The last of these — the Consumer Prices Index including owner occupiers’ housing costs (CPIH) — led the summary in the ONS’s report. It is commonly used in both the UK and in the EU so my main comparison above focuses on this measure.

If western governments throw debt-fuelled money at their Covid-19 measures on unprecedented levels for two years, it should come as no surprise to anyone that the inflationary pressures would inevitably come home to bite.

When added to the effects on prices of Putin’s illegal invasion of Ukraine — on the costs of energy, grain, fertiliser and sunflower oil — we are now in a perfect storm.

Inflation has become a serious issue for many households across the United Kingdom. That said, if the BBC want to make international comparisons then we might expect them to compare the UK with the EU, as they so often do.

Not on this occasion. And the basic facts in this report above show why.

Things will get worse before they get better, but the simple fact is that once again Brexit Britain is outperforming the European Union.

Of course, all the main culprits who are the BBC, ITV, Sky, and Labour, along with “BOLLOCKS TO BREXIT Liberal Demcrats will not tell you the truth. They all hate the fact that Brexit Britan is proving them wrong.

However, I will always show you what they will not show.

Sources: Office for National Statistics (ONS) | EU Commission statistics agency (Eurostat)