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Although inflation has fallen significantly since the October 2022 high, prices have not fallen. They have just been rising less quickly.<\/p>\n
Inflation soared in 2022 because oil and gas were in greater demand after the Covid pandemic, and energy prices surged again when Russia invaded Ukraine.<\/p>\n
It then remained well above the 2% target, partly because of higher food prices.<\/p>\n
The <\/b>figures show food price inflation fell from 3% in the year to April to 2.2% in the year to May.<\/p>\n
The rate of inflation for bread, meat, pasta and vegetables all dropped compared to last year.<\/p>\n
The Agriculture and Horticulture Development Board said that British households are struggling to afford beef at the moment, meaning demand for the product has fallen.<\/p>\n
At the same time, while the number of cows being slaughtered has fallen, carcasses weigh more so there’s been oversupply.<\/p>\n
The ONS says that the price of beef and veal (it lumps them both together) rose by 9.3% in May which, admittedly is still high.<\/p>\n
But compared to previous months when prices jumped by as much as 27%, the slowdown is evident.<\/p>\n
However, it can take seven to 13 months for cost increases in the food supply chain to feed through to prices on supermarket shelves.<\/p>\n
The Food and Drink Federation, which represents manufacturers, said that current food prices don’t reflect the impact of the Strait of Hormuz closing.<\/p>\n
It warned that food inflation was likely to rise this year and into 2027.<\/p>\n
Employees who face higher living costs are more likely to push for pay rises. <\/p>\n
Firms who are already facing higher staff costs as a result of increased employer National Insurance contributions and minimum wage hikes are then under pressure to put up their own prices. This can in turn contribute to higher inflation. <\/p>\n<\/div>\n
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