The Prime Minister says he feels a “deep moral responsibility” to deliver on his pledge to halve inflation after the key driver behind the cost-of-living crisis stayed static last month.
Office for National Statistics data published on Wednesday showed that the Consumer Prices Index inflation (CPI) remained at 8.7% in May, the same level as in April, despite experts forecasting a fall to 8.4%.
Rishi Sunak, due to speak on Thursday at an economy-focused PM Connect event in the south-east of England, will look to reassure workers about the pressures being caused by rising prices.
The Conservative Party leader will tell business figures that halving inflation is his administration’s “number one priority” and that he wants to “get back” to the target of inflation being at 2% — less than a quarter of what it stood at last month.
In pre-briefed comments, Mr Sunak is expected to say: “I feel a deep moral responsibility to make sure the money you earn holds its value.
“That’s why our number one priority is to halve inflation this year and get back to the target of 2%.
“And I’m completely confident that if we hold our nerve, we can do so.”
The premier’s speech will take place after Bank of England decision-makers have met to look at interest rates.
The Bank is expected to raise the base rate by 0.25 percentage points on Thursday, taking it to 4.75%.
Some commentators have even raised the possibility of a more aggressive increase of 0.5 percentage points.
The Bank is tasked with keeping inflation as close to 2% as it can, and the best tool it has to do that when inflation is high is by raising the base interest rate.
But a further rise is likely to pile more pressure on mortgage-holders as rates are already at close to 15-year highs.
Chancellor Jeremy Hunt has said the Government will “stick to its guns” and insisted patience was needed for the Bank’s rate rises to curb inflation.
The Treasury chief has so far dismissed suggestion that ministers could intervene to assist homeowners with rising mortgage rates.
Addressing business figures on Thursday, Mr Sunak will stress that “beating inflation has to be the priority”.
He is set to add: “Because if we don’t get a grip on inflation now, the damage will be worse and longer lasting.”
Wednesday’s CPI figures mean that a shop which cost around £100 a year ago would cost around £108.70 today.
Stubborn inflation is set to increase pressures on households.
Figures from the Money Advice Trust show that since March 2022 the number of adults who are behind on one or more household bill has risen from 7.9 million to 11.6 million.
Halving inflation by the end of the year is one of the Tory Prime Minister’s top five pledges to the country ahead of a likely general election in 2024.
He has also set the goals of growing the economy, reducing national debt, stopping boats of migrants from crossing the Channel and cutting NHS waiting lists.