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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, based on business information that implies an ongoing squeeze on family funds.
Meals costs rose at an annual fee of two.8 per cent on this month, up from 2.6 per cent in April and the quickest tempo since Might final yr, the British Retail Consortium mentioned on Tuesday.
Helen Dickinson, chief govt of the BRC, mentioned: “Contemporary meals had been the principle driver, and crimson meat eaters might have observed their steak received just a little dearer as wholesale beef costs elevated.”
Dickinson mentioned 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.
World food prices had been up by an annual fee of seven.6 per cent in April, based on the UN Meals and Agriculture Group index, with vegetable oil and dairy merchandise rising by greater than 20 per cent yr on yr.
Nonetheless, the BRC mentioned costs of non-food gadgets remained in deflation at minus 1.5 per cent, retaining general grocery value inflation at minus 0.1 per cent in Might.
The BRC information additionally confirmed a divergence between rising annual inflation for recent meals and an easing development for ambient meals, similar to canned items.
The commerce physique’s figures come forward of official inflation information for Might on June 18. BRC and inflation information to this point this yr have proven a pick-up in meals value development in contrast with most of 2024, reflecting increased wholesale meals costs and better prices for companies.
In April, the ONS reported sharp month-on-month value will increase for meat, oil and confectionery as general inflation jumped greater than anticipated to three.5 per cent.
Inflation is predicted to stay elevated for a lot of the yr, pushed by vitality and meals, although general wage growth continues to outstrip the speed of value will increase.
“We recognise that it will likely be extremely painful for individuals, significantly the place that is about vitality, meals,” Clare Lombardelli, Financial institution of England deputy governor, mentioned earlier this month because the central financial institution lower 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, mentioned growing meals costs had been “an additional problem to shopper spending alongside rising family payments”.
“If shopper confidence stays weak, as seems seemingly, then retailers might need to work tougher to encourage consumers to spend over the summer time,” he added.
