Cost of living: McDonald’s, Kraft Heinz and Reckitt raise prices, as gas soars – as it happened

A McDonald’s Happy Meal including a cheeseburger with fries. Photograph: Rogelio V Solis/AP

3.38pm BST

Closing summary

Time to recap....

Consumer-focused companies have been raising their prices sharply, concluding that customers will keep stumping up for their wares despite the cost of living squeeze.

McDonalds made the most eye-catching move, lifting the price of the popular cheeseburger over the £1 mark - in a 20% hike from 99p to £1.19.

The fast food chain pointed out that this super-size increase was the first in 14 years, as it bowed to pressures from higher input costs such as food and energy.

But other products are going up by 10p to 20p each, which will put more strain on customers.

Reckitt Benckiser, the firm behind health and hygiene brands from Durex to Dettol, has hiked its prices by 9.7% in the last quarter, and still saw sales volumes rise.

Sales of its baby formula products surged, due to shortages in the US.

And Kraft Heinz put up its prices by 12.4%, having been hit by rising costs for raw materials.

Both Reckitt and Heinz have lifted their forecasts for the year, after their price rises helped them beat expectations.

Shoppers are already suffering higher prices, with shop price inflation hitting the highest level since at least 2005 this month. Fresh food soared, driven up by rising charges for fertiliser, animal feed and transport.

Gas prices have surged, as Russian supplies to Europe slowed to a relative trickle. Nord Stream 1’s output halved today to just 20% of capacity, with Moscow blaming technical problems.

Russia delivered less gas to Europe on Wednesday in a further escalation of an energy stand-off between Moscow and the European Union that will make it harder, and costlier, for the bloc to fill up storage ahead of the winter heating season.https://t.co/OblaGq6FkX

— Jennymanydots (@jenstilmanydots) July 27, 2022

The Dutch wholesale gas price for August , the European benchmark, jumped 9% to 205 euros per megawatt hour on Wednesday, up around 412% from a year ago.

— Jennymanydots (@jenstilmanydots) July 27, 2022

Analysts have warned that home energy bills in the UK could soar to £3,850 from January, with wholesale gas prices at their highest level since March today.

But some industry insiders suggest bills may ‘only’ rise to £3,300 in early 2023, from around £2,000 per year today.

But some commodity prices have dropped. Mining company Rio Tinto reported a fall in earnings, as weaker iron ore price hit profits.

Here are more of today’s stories:

3.30pm BST

Orders at US factories for long-lasting goods jumped 1.9% in June, calming fears of a recession.

June’s durable goods orders were stronger than expected, partly due to more demand for new cars and military aircraft.

Yesterday was “what is a recession day!” Today, “reality” - durable goods orders rose 1.9% in June, and are up 10.9% from a year ago. Big ticket capital goods (the machines that make the machines) were up 9% in Q2. These orders are leading indicators! Best recession ever!

— Brian Wesbury (@wesbury) July 27, 2022

US Durable Goods Orders Jun P: 1.9% (est -0.4%; prevR 0.8%)
Headline durable goods crushes expectations fueled by transport orders; business investment above expectations as well which is supportive for 2QGPDhttps://t.co/mihIRRMcIh#durablegoods #GDP https://t.co/eMauWOtQ4j pic.twitter.com/1TE6LCyIvs

— Neil Sethi (@neilksethi) July 27, 2022