Big increases in the price of fish, fats and vegetables have driven food price inflation to the highest level in more than four years.
New data from the Office for National Statistics (ONS) shows food prices last month were up by 4.2% on 12 months earlier, a sharp increase on the 0.6% that food inflation was running at just a year ago. The October increase was the highest since 2013 and prompted the British Retail Consortium (BRC) to warn that consumers face the prospect of an expensive Christmas dinner this year.
Among the sharpest price increases was an 8.5% rise in the price of fish, while vegetables were up 5.7%, fats and oils were up 5.6%, and milk, cheese and eggs have climbed 4.8%.
‘Butter has gone up by 40%’
Other big price rises included an 8.5% leap in the prices of tea, coffee and cocoa over the past year and a 4.3% increase in beer prices.
However, cheaper fuel and deep discounting by hard-pressed retailers cancelled out the impact of higher food prices to leave the annual increase in Britain’s overall cost of living unchanged at 3% in October.
It was the second consecutive month that the government’s preferred measure of inflation – the consumer price index (CPI) – stood at 3%, confounding the Bank of England’s expectation of a small rise. Any inflation rate above 3% requires the Bank’s governor, Mark Carney, to write an explanatory letter to the chancellor, Philip Hammond.
Rachel Lund, the BRC’s head of retail insight and analytics, said higher food bills meant consumers were cutting back in other areas of spending, forcing non-food retailers to offer bargains. She warned:
“It may be an expensive Christmas dinner this year as a result of more costly imports and higher world food prices, particularly for dairy products.”
Lund added: “With more of consumers’ incomes being absorbed in spending on food, retailers of non-food products are having to compete harder for business. In a dismal month for non-food sales, shoppers were offered significant discounts, leading to a drop in the inflation rate of goods such as furniture and clothing.”
Source: The Guardian.