The inflation rate has stayed the same for the past few months, according to a recent Bank of England inflation update. However, that doesn’t mean that supermarket prices are in the clear, as worl events may have a delayed effect on that in the coming months. The Office for National Statistics (ONS), which publishes the figures on inflation, said that food inflation is slow compared to other areas of consumer spending. Economists had predicted that the rate would rise to 3% in May, so it is a welcome relief for many households.
“While the war in the Middle East pushes prices up globally, we have got the right economic plan and inflation has held steady,” Chancellor Rachel Reeves said after the figures were released earlier this week. However, supermarket prices may not be in the clear when it comes to the effects of the Middle East conflict, one expert has warned. Industry insiders and analyists have previously warned of more expensive groceries as a result of the war, but that hasn’t quite been felt by UK households just yet.
Karen Betts, chief executive of the Food and Drink Federation (FDF), told The Sun: “It’s good to see an easing of food inflation in May, but consumer prices still don’t reflect the inflation caused by the closure of the Strait of Hormuz.
“It generally takes several months for the increased costs paid by farmers, processors and manufacturers to filter into raised prices at the tills… and we expect food inflation to pick up this year and into next.”
Several experts previously told the Daily Express about the effects the war would have on supermakret prices. Jim Mellon, an investor and Chief Executive of Agronomics, said: “Global conflicts, along with climate change, are causing food shortages, supply chain issues and price spikes in the UK and beyond.”
George Philips, who is the the commercial director of the UK’s largest World Food distributor and wholesaler, Wains, listed several items at risk of increases.
- Bottled water
- Cooking oil
- Washing up liquid
- Tea
- Coffee
- Rice
- Sugar
- Meat
- Milk
- Bread
- Pasta
- Cereal
Retail analysts at Omnisend said that oil and gas prices will make the transport of goods more expensive, which will eventually be felt in the final price displayed in shops. “That extra cost rarely disappears, and most of Britain’s biggest retailers will likely do anything to avoid it impacting their margins, so unfortunately, it tends to be passed down the chain, while making sure to avoid deterring consumers entirely,” said retail analyst Marty Bauer.