How long will the recession last?

The Bank of England forecasted last month that the country could be at the start of an eight-quarter recession, the longest since reliable records began in the 1920s.

Gross domestic product (GDP) could shrink for every quarter for two years, with growth only coming back in the middle of 2024.

The economy has faced similarly long recessions in the past, but then the quarterly drops have been broken up with an occasional positive quarter.

Meanwhile, inflation has now hit a 41-year high of 11.1 per cent.

At its heart, inflation is a way of checking exactly how quickly prices are increasing for households across the UK.

It is an average across many categories, so if food prices rise, that could still be offset by drops in, say, the price of petrol.

The Office for National Statistics (ONS) is tasked with estimating the UK inflation rate.

It has a basket of goods and services that it tracks.

It might be helpful to think of this as a massive shopping basket containing what the ONS thinks that people in the UK buy. It includes around 730 items

The ONS’ researchers take an average of the increase or decrease of the items’ prices from a year ago – and this is the inflation rate.

In his autumn statement, Mr Hunt committed to increase the state pension and benefits in line with September’s 10.1 per cent inflation figure.