Some items and services haven’t hit their price ceiling yet according to experts (Image: GETTY)
Despite a welcome drop in inflation to 2.5% after months of rising figures, the prices of 10 common items and services are expected to continue climbing in the coming months.
This is largely due to a series of tax changes set for April, uncertainty surrounding the Bank of England’s next decision and the impending change in US government with ‘s second term inauguration next Monday
experts have identified 10 specific areas likely to experience persistent price increases despite the new inflation data, beginning with a tax hike affecting numerous industries.
Since the October budget, business experts from various sectors have warned that the increased employer national insurance rates starting in April will likely result in products and services experiencing a surge in overhead costs as employers pass on this increase to their customers.
More specifically, food prices are predicted to continue rising due to the national insurance change and other tax and industry changes impacting supermarkets.
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The British Retail Consortium estimates this could lead to an annual increase rate of 4.3% by the end of 2025.
The financial markets are currently in a state of flux due to the recent inflation news, but experts predict that by 2025, rates will be significantly higher. The uncertainty surrounding how much this could rise may depend on the Bank of England’s base rate decisions in the coming months.
The pound is also fluctuating, currently trending weaker and down 12 cents against the dollar since September. This ongoing weakness will continue to make importing goods more expensive, a trend also fuelled by concerns over potential trade tariffs from the Trump administration.
Rising global oil costs, coupled with a few tax changes, will see the cost of driving steadily increase over the next few months. Phone and broadband contracts, other costly necessities of modern life, are also facing price fluctuations following the implementation of new regulations.
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From the start of January, new contracts will have set price increases instead of rises tied to inflation, while those who had their contracts before 2025 are likely still facing larger costs tied to December’s inflation rate. A separate change saw the energy price cap increase for the second time in a row at the start of the year, causing energy bills across the nation to rise as the UK battled freezing temperatures.
The average water bill is set to surge by 36% over the next five years, with the increase largely dependent on your location. Figures released just before Christmas indicated that Southern Water customers could face the steepest hikes starting in April, with bills potentially soaring by a whopping 53% by 2030.
In addition, council tax is slated to rise by up to 3% in the upcoming financial year for the core council tax in England, along with an extra 2% increase allowance for adult and social care elements. While specific increases for authorities in Wales and Scotland are yet to be finalised, it’s been reported that rises of up to 10% are being considered as the latter includes water rates.