British consumer price inflation hit a 40-year high of 9.1 percent last month, the highest rate among the Group of Seven countries (G7)  and highlighting the depth of the cost-of-living crisis. Soaring food costs were a major factor in this increase.

The reading, up from 9.0 percent in April, was in line with the opinion of analysts surveyed by Reuters. May's inflation was the biggest since March 1982, according to historical data from the Office for National Statistics, and it's expected to become worse. Sterling, one of the worst-performing currencies this year against the US dollar, dropped below $1.22 on the day, losing 0.6 percent.

Given its high energy import cost and ongoing Brexit issues, which could further harm trade relations with the European Union, some investors believe that Britain faces a danger of both chronically high inflation and recession. According to Jack Leslie, senior economist at the Resolution Foundation think tank, "with the economic future so uncertain, no one knows how high inflation could go, and how long it will persist for." This makes decisions about fiscal and monetary policy particularly difficult.

Earlier on Wednesday, the Resolution Foundation claimed that Brexit, which had made Britain a more closed economy, had compounded the cost-of-living damage for households and had negative long-term effects on productivity and wages. In May, Britain had a higher headline inflation rate than the US, France, Germany, and Italy. Although Japan and Canada haven't yet submitted their May consumer pricing reports, neither is probably going to come close.

FOREX-Euro goes up as ECB officials affirm rate hike plans

Crude Oil: Iraq seeks to raise production to 8 mn bpd by 2027

Austria's inflation touches its highest level in 46-yrs in May