Welcome to This Is Money podcast. I'm Georgie Frost and alongside me and editor Simon Lambert. Today is assistant editor Lee Boyce. And coming up, the cost of living is rising. Wages are too. But are we at risk of stagflation and it's okay to ask, what the heck is stagflation? We also talk supply chain problems and staff shortages. Can we expect higher prices in the shops and more

spicy grilled chicken shortages? And is Britain set for a hiring boom? It's not just stores,

though, that are suffering, soaring costs and tradesmen shortages are leaving families

doing home improvements themselves or stuck with half-finished renovations. And we go inside the pocket-sized houses

aimed at first-time buyers in London. We left the cat at home as there wasn't enough room

to swing it. Don't forget you to stay out to date with all the latest breaking money news. Just go

to this ismoney.com.uk or download the app. But first, the cost of living jumped by the largest amount on

record last month, with the rise in price being blamed on pandemic chaos, aka transport, petrol

and some food stuff in there as well, which we'll get into. Inflation rose from 2% in July

to 3.2% in August.

So could it run out of control and might finally the Bank of England raise interest rates

and therefore we can play our game again of guess the interest rate rises, Simon?

What's going on? Why is inflation up?

Well, it should be noted that this is the biggest jump in inflation between month to month

that has been seen for a considerable amount of time.

In fact, it's the biggest one on record.

So that's, i.e., a considerable amount of time.

But this biggest spike since 1997, which was the last time we had one that

was near enough to this, has been issued with a note of caution by the O&S that said we are comparing

to a strange time a year ago. So if you look at the inflation bulletin, it basically says that the largest

contribution to inflation was base effect. What does that mean? Not everybody's gone out and bought

some massive speakers. It means that we're comparing to a time a year ago when prices were depressed.

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