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Welcome to the briefing room with me, David Oronovich.

The briefing room is the mind chamber where in 28 minutes,

you and I get to understand a big issue with the help of the top experts on the subject.

This week is inflation back? In olden days when nights were bold,

the number one economic problem was inflation, the rise in the cost of living. And now inflation

is making a comeback. Energy costs are up and about to go much higher. Fuel is up. Prices in the

supermarkets are up. The retail price index is at a 30-year high. So, is big, bad inflation

coming back and what can be done about it? Step inside the briefing room and together we'll find out.

First, let's remind ourselves what inflation actually is and how bad it once was.

With me is Economist Duncan Weldon, author of 200 years of muddling through.

Duncan, before we come on to the history of inflation, let's just look at the

here and now. How much of a shock to today's economy is high inflation, given that we've been

more or less without it for decades? Yeah, so at the moment, inflation is rising at an annual

pace of over 5% in Britain, over 7% in America. This is much higher than the numbers we've been

used to for the last few years. Also, it's taken economists, it's taken observers by surprise.

If you went back to the start of last year, very few people saw this big spike in inflation coming.

Right. When we talk about inflation, what does it actually consist of? How do we

measure it? The straightforward way of describing inflation is it's just the average rise in

prices across the economy. And you know, the way statisticians at our own Office of National

Statistics look at it is, they look at what they call a representative basket, a selection of goods that

they think the average British person is buying, and they track the prices of that basket of goods.

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