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UK meals inflation rose for the fourth consecutive month to a one-year excessive in Might, pushed by recent meals costs, in response to business knowledge that implies an ongoing squeeze on family funds.
Meals costs rose at an annual price of two.8 per cent on this month, up from 2.6 per cent in April and the quickest tempo since Might final 12 months, the British Retail Consortium stated on Tuesday.
Helen Dickinson, chief govt of the BRC, stated: “Contemporary meals had been the principle driver, and pink meat eaters might have observed their steak acquired a bit of dearer as wholesale beef costs elevated.”
Dickinson stated retailers had been now absorbing a further £5bn in prices from will increase to employer nationwide insurance coverage contributions and the minimal wage, which took impact in April.
International food prices had been up by an annual price of seven.6 per cent in April, in response to the UN Meals and Agriculture Group index, with vegetable oil and dairy merchandise rising by greater than 20 per cent 12 months on 12 months.
Nevertheless, the BRC stated costs of non-food objects remained in deflation at minus 1.5 per cent, maintaining general grocery worth inflation at minus 0.1 per cent in Might.
The BRC knowledge additionally confirmed a divergence between rising annual inflation for recent meals and an easing development for ambient meals, corresponding to canned items.
The commerce physique’s figures come forward of official inflation knowledge for Might on June 18. BRC and inflation knowledge thus far this 12 months have proven a pick-up in meals worth progress in contrast with most of 2024, reflecting greater wholesale meals costs and better prices for companies.
In April, the ONS reported sharp month-on-month worth will increase for meat, oil and confectionery as general inflation jumped greater than anticipated to three.5 per cent.
Inflation is anticipated to stay elevated for many of the 12 months, pushed by vitality and meals, although general wage growth continues to outstrip the speed of worth will increase.
“We recognise that it will likely be extremely painful for folks, significantly the place that is about vitality, meals,” Clare Lombardelli, Financial institution of England deputy governor, stated earlier this month because the central financial institution reduce rates of interest by 1 / 4 level to 4.25 per cent.
Mike Watkins, head of retailer and enterprise perception at NielsenIQ, which compiles the info with BRC, stated rising meals costs had been “an additional problem to shopper spending alongside rising family payments”.
“If shopper confidence stays weak, as seems possible, then retailers might must work tougher to encourage buyers to spend over the summer season,” he added.
