We're finishing our coverage of the rise in inflation now - thanks for joining us.

Today's writers were Natasha Preskey, Jen Meierhans, Charley Adams, Joshua Nevett, Paul Seddon and Doug Faulkner.

The page was edited by Emma Owen, with help from Alex Therrien.

We'll be finishing up our live coverage of the rise in inflation and PMQs shortly.

Here's a brief recap of what's happened:

• ONS figures released first thing this morning showed UK inflation - the rate at which prices rise - is at its highest in 40 years - it has risen to 9% in the 12 months to April
• It prompted Labour to repeat calls for a one-off tax on oil and gas, saying it would raise billions that could be used to ease energy prices for those struggling

• At Prime Minister's Questions, Boris Johnson said he would look at "all sensible measures", but said he was not in favour of higher taxation in general
• Chancellor Rishi Sunak said he could not protect people completely from rising inflation as it was a global problem - he's expected to elaborate on this at a speech to business leaders later this evening

If you'd like to delve deeper into the issue of inflation, you can find coverage, analysis and explainers on our politics and business pages.

And we'll leave you as we started, with this graph showing inflation rates over the years.

Image source, Getty Images

Chancellor Rishi Sunak issued a few words on inflation earlier today, saying the government "stood ready to take further action".

This evening, he's due to speak at the annual dinner of the Confederation of British Industry, and is expected to warn that it will not be easy for the government to address the rising cost of living.

According to extracts of his speech released in advance by the Treasury, Sunak will tell businesses that government plans to deliver tax cuts in the autumn budget should encourage them to "invest more, train more, and innovate more".

Sunak will also say the government cannot make "global forces disappear overnight" and "the next few months will be tough".

Reality Check

Earlier today at Prime Minister's Questions, Boris Johnson told MPs: “In July, we will have the biggest tax cut for 10 years, £330 cuts for 30 million people who are paying national insurance contributions.”

The £330 cut he is talking about is because the point at which people start paying National Insurance is rising from earnings of £9,570 to £12,570 a year.

The Treasury says this – along with a plan to cut income tax in 2024 – will be the biggest tax “giveaway” since 1995.

But – if you look beyond these measures - the reductions are actually smaller than the increases in taxes the chancellor announced in the previous year.

And the government’s independent forecaster the Office for Budget Responsibility says the overall tax burden is going to rise from 33% of GDP (a measure of the size of the economy) in 2019-20 to 36.3% of GDP in 2026-27.

This would be the highest since the late 1940s.

You can read more about it here.

First-time buyers face higher house prices and savings hit by inflationpublished at 15:29 British Summer Time 18 May 2022

15:29 BST 18 May 2022

Kevin Peachey
Personal finance correspondent

Image source, Getty Images

Younger people looking for even the smallest crumb of comfort in today’s figures can look to the cost of buying a home - even if the overall trend continues to be of properties becoming more expensive and out of reach for many.

The price of the average home still rose by £24,000 in the year to March - bringing it to £278,000, according to the Office for National Statistics (ONS).

However, the pace of increase is slowing. In March, the annual increase was 9.8% compared with 11.3% in February.

That’s still extremely high but forecasts suggest that house price growth will slow in the next year or two.

The difficulty for many first-time buyers is that their savings are being eaten away by inflation, rather than growing and ready to use as a deposit when getting a mortgage.

The chief secretary to the Treasury Simon Clarke said Rachel Reeves' speech “failed to rise to the magnitude of the moment”.

As expected, he did not give his backing for Labour's call for an emergency budget.

Instead, he said the government had “responded quickly and comprehensively to the greatest challenge of our generation” with what he said was a package of financial support.

He said the government was creating the conditions for growth by investing in skills and infrastructure.

Returning now to the Commons, where MPs have been concluding their debate on the government's Queen's Speech, and Labour has called for an emergency budget to address the rising cost of living.

In a speech, Labour's Shadow Chancellor Rachel Reeves criticised the Conservative government’s handling of the economy, accusing ministers of failing businesses and consumers.

She cited a survey by the Food Foundation think tank, which suggested two million people were skipping meals because they cannot afford to eat every day.

“This is not normal,” Reeves said. “It is the consequence of Conservative government choices.”

A retired couple have told us the rise in petrol prices and energy bills means they've had to cut down on how often they see their children and grandchildren.

Mike Gibbons 75 and his wife Ev, 72, from Southampton have six daughters between them, and while hers live not too far away, his are in Newcastle-under-Lyme and Milton Keynes.

Mrs Gibbons said: "They only have little houses, so we can't stay so we have hotel bills and petrol on top of it. It's a bit of a killer at the moment so we are budgeting and we are not going so often."

Mr Gibbons said their energy bills had gone up by £88 a month after their provider PurePlanet went bust and they moved to Shell.

He said each 450-500 mile trip to see his family in Newcastle-under-Lyme now cost £25 more in petrol.

Mrs Gibbons said: "It's making it more difficult to see our family on a regular basis because you just can't afford it any more - the money's not there. We just can't see our children as much as we'd like to."

Image source, Getty Images

We've just heard the British Chamber of Commerce talk of the possibility of a recession in the UK later this year - something analysts last week warned about as well.

So, what does a recession actually mean?

Clothes, food, cars... we make and sell loads of things in the UK. The more we sell, the more money the country makes. When that happens, the economy grows.

People, on average, become slightly richer as the value of the goods and services we produce - our Gross Domestic Product (GDP) - increases.

But sometimes, this falls instead, which means our economy is shrinking.

If this happens for a period of six months in a row, then this is called a recession.

When the economy shrinks, some people may lose their jobs, struggle to find new ones or find it harder to get promotions or pay rises.

However, the impact of a recession is usually not felt equally across society, and inequality can increase.

Could there be a recession soon?

It's possible.

The economy grew by 0.8% over the first three months of the year, but in March it shrank by 0.1% as people cut back due to rising prices.

Speaking last week, Paul Dales, chief UK economist at Capital Economics, said the latest figures "suggest the economy had less momentum than we thought" and that the risk of recession "has just risen".

More reaction now to news today that UK inflation - the rate at which prices rise - jumped to 9% in the 12 months to April, up from 7% in March., external

The British Chamber of Commerce has described the rise as "eye-watering" and has warned there is a real chance of a recession by the third quarter of the year.

The BCC's head of economics, Suren Thiru, said inflation may "moderate a little over the summer" but was likely to increase even further in October to above 10% when the energy price cap rises.

He said a June interest rate rise was inevitable.

"However, higher interest rates will do little to address the global factors driving this inflationary surge and risks undermining confidence and aggravating the financial squeeze on consumers and businesses," he said.

The BCC is calling for the government to reverse the rise in National Insurance contributions and cut VAT on business energy bills to 5%., external

A senior Conservative MP has backed a windfall tax on oil and gas giants - a move Labour has repeatedly called for - saying "desperate times call for desperate measures".

Robert Halfon accused oil companies of "ripping off" customers by not passing on the 12-month fuel duty cut that came into effect in March, making life "very difficult for millions of people across the country".

Speaking on BBC Radio 4's The World at One, the chairman of the Commons Education Select Committee suggested money raised from a windfall tax and from scrapping green levies, could be put towards a further rebate on people's energy bills.

"I reckon there are arguments on both sides on this in terms of employment and investment, I get it," he says. "But I think desperate times call for desperate measures and we must do this, and we must do it quickly."

Image source, Parliament

MPs in the Commons are now debating the Queen's Speech, which was announced last week and sets out the government's agenda.

In case you missed it, here's a quick recap of Prime Minister's Questions earlier, which was dominated by the rising cost of living:

Taxing times: Labour leader Sir Keir Starmer asked the PM if he was for or against his party's plan for a one-off windfall tax on oil and gas companies. Boris Johnson said "in principle" the government doesn't want to raise taxes

Wind of change: Sir Keir predicted an "inevitable" U-turn on the proposed tax, saying oil and gas companies were making extra profits worth £32m a day. Johnson said he would "look at all measures in future"

Boom or gloom: The Labour leader said Johnson was pretending the economy was booming, which showed the PM had his “head in the sand”. But Johnson said his government had got more people into work and that was the answer to stimulate the economy

Call for support: In his final question, Sir Keir said working people felt abandoned by the government. In reply, the PM reminded him that investment in public services wouldn’t be possible without a strong economy

Poor punished: The SNP's Ian Blackford said under the Tories the "poorest are punished the most". Johnson disputed that and said raising the living wage and helping people on benefits was creating a strong economic foundation

Farmed out: Liberal Democrat leader Sir Ed Davey used his question to draw attention to farmers, whose state subsidies are being cut as production costs rise. The PM said he recognised the challenges farmers were facing and was championing the food export market

Image source, Parliament

Image source, PA Media

The marked rise in inflation has been disconcerting to watch in recent months, as global economic shocks send living costs skyrocketing.

As we've been reporting, Labour is calling for a one-off windfall tax on oil and gas firms.

They say a windfall tax would raise £1.2bn, but the government argues that such a tax could discourage crucial investments that would eventually bring down energy costs.

But there are ways of counteracting inflation and helping households deal with the fallout, for example:

Bank intervention

By raising interest rates, the Bank of England can make borrowing more expensive - encouraging people to save instead of spend.

So far, this hasn't reversed inflation, but central banks argue that without such measures, inflation would be rising faster.

Direct support

Governments can also give direct support to households by giving cash handouts, and placing caps on energy prices.

The Chancellor, Rishi Sunak, has said “we cannot protect people completely from these global challenges but are providing significant support where we can”.

Read more: When might the inflation rate come down?

With prices rising at their fastest rate for 40 years, debt charities are warning there is an urgent need for extra support to help people struggling with the rising cost of living.

StepChange Debt Charity says the surging cost of living is now the third most common reason people are giving for their debts.

The charity's director of external affairs, Richard Lane, says there needs to be targeted support for those on low incomes, who rely on social security, or have vulnerabilities that mean they have specific needs and cannot cut their spending in areas such as food and energy.

Michael Clarke, of Turn2us, says the increase in cost of living was going to "plunge thousands more people into financial insecurity", adding that intervention was "urgently needed" to catch people before they fall into crisis in the months to come.

Jane Tully, director of external affairs and partnerships at the Money Advice Trust, says today's figures should "raise the alarm" on the need for support to help households that are struggling.

Will the UK stay at wrong end of G7 inflation league table?published at 13:30 British Summer Time 18 May 2022

13:30 BST 18 May 2022

Faisal Islam
BBC Economics Editor

The raw headline figures among the major economies now show the UK has the highest inflation in the G7.

Now, it is important to note that this is just a single month and there are important methodological differences in how inflation is calculated, especially with the US.

However, the comparison tells a broad story - for example, versus France, where inflation is about half the level in UK.

This is a direct result of the French government forcing mainly state-owned energy companies to limit electricity bill rises to single digits, rather close to the presidential election. The shareholders of EDF paid the price.

It is well worth watching if the UK stays at the wrong end of this league table.

The IMF recently predicted UK high inflation would linger for longer - over the course of next year being the highest in the G7 - and higher than all EU members, and only exceeded in the G20 by crisis-ridden Argentina, Turkey and Russia.

Many economists predicted that as a result of the post-Brexit end to free-flowing trade with the EU, and a shortage of European workers, that the UK would be more inflation-prone.

So far the UK record has, more or less, moved in line with the rest of the world. The question is if this might be the start of a divergence.

Student Kira Hayward has been telling us the practical things she's been doing to cope with rising prices, from batch- cooking to putting cash into a budget binder.

The 19-year-old from Hull works part-time for a production company in Manchester but says rising food prices mean her money does not stretch as far.

She said her shopping now costs £10 more per week.

"I used to shop every week, but I do it every 10 days or two weeks now, and at the cheaper places. And I try and get a big batch of chicken and freeze it all and make sure I split them up and make a batch meal like spaghetti bolognese.

"It is frustrating that even though I'm putting money aside I'm having to cap what I spend on everything."

Kira has started putting cash into plastic wallets labelled with what it is to be spent on.

You can read more of people's spending solutions here.

It's not just Labour calling for a windfall tax on oil and gas companies to help with the cost of living.

The general secretary of the Trades Union Congress (TUC) - the UK's umbrella group for unions - also says it is urgently needed.

A windfall tax is a one-off tax imposed by a government on a company or group of companies.

"With inflation so high, the crisis is cold, hard reality, and families are desperate for the government to help with an emergency budget", said Frances O'Grady.

"The chancellor must step up with an emergency budget that helps families with a boost to Universal Credit and the minimum wage, and we urgently need a windfall tax on oil and gas to fund energy grants for struggling households."

During Prime Minister's Questions, Sir Keir Starmer questioned Boris Johnson's position on a windfall tax on oil and gas companies to help fund extra support towards the cost of living.

The Labour leader reiterated that he was in favour of the tax.

In response, the prime minister did not give a direct answer on whether the government might implement the measure, and went on to accuse Labour of wanting to raise taxes.

David Wallace Lockhart
BBC political correspondent

Image source, Getty Images

The Labour leader, the SNP leader and the Lib Dem leader all got the opportunity to put questions to the Prime Minister this afternoon. They all raised, in one way or another, the cost of living.

It’s no secret that this is the key issue facing the government. And they’ve made clear that more help will be coming.

And the prime minister stressed the help that’s already out there, such as rises to the minimum wage.

The potential interventions floating around government range from a windfall tax on record oil and gas profits, to making MOTs for cars less frequent.

Boris Johnson faces pressure not just to act, but to do so in a way that makes a difference to those finding life most difficult.

And there’s only so long he can say more help is on the way, before he has to deliver.

With that, Prime Minister's Questions has finished and MPs are leaving the chamber.

A Home Office minister is answering questions now, but MPs will continue debating the Queen's Speech, which sets out the government legislative agenda, in a bit.

Labour is planning to use the debate to put their call for an emergency budget to a vote. However the government has not backed the plan and it is unlikely to be supported by Conservative MPs either.

We'll turn our focus back to the latest updates on inflation and the cost of living now, but you can continue to follow proceedings in Parliament on BBC iPlayer.

And we'll bring you lines on that emergency budget call when it happens.