UK prices are now rising at the fastest rate since 1982, according to data released by the Office for National Statistics (ONS) this morning.
Inflation hit 10.1% in the year to July and is higher than analysts had been predicting.
Rising food and drink prices made the biggest contribution to the change in the inflation rate between June and July 2022, according to the ONS.
Chancellor Nadhim Zahawi says getting inflation under control is his "top priority".
"I understand that times are tough, and people are worried about increases in prices that countries around the world are facing," he says.
"Although there are no easy solutions, we are helping where we can through a £37bn support package, with further payments for those on the lowest incomes, pensioners and the disabled, and £400 off energy bills for everyone in the coming months."
The Bank of England predicts that it could go up to just over 13% by the end of the year because of the rise in energy prices.
Its target inflation rate is 2% and the Bank has been raising interest rates to try to get inflation down.
This increases the cost of borrowing and encourages people to borrow and spend less.
It also encourages people to save more. However, it is a tough balancing act as the Bank does not want to slow the economy too much.
Grant Fitzner, chief economist at the ONS, says around half of the 10.1% rise is down to energy prices.
Energy prices were picking up even before Russia invaded Ukraine, he told the BBC.
But now goods prices are up 2.7% and services 4.9%, he says, adding that this "is not simply an energy story".
"Cost pressures have spread through most parts of the economy," he said.
Increases in food prices are the most significant in the last month, Fitzner says, with bakery products, dairy, meat, vegetables and takeaways all picking up.
Overall, there was a 2.3% rise in food and drink prices - a "huge" number, he said.
For businesses, Fitzner says producer prices are close to "all-time record highs".
The price of items leaving factory gates are up by 17% - the highest since 1977, he added.
The last time inflation was this high, Come On Eileen by Dexys Midnight Runner was Number 1.