Inflation hits 40-year high of 9.4% as annual grocery bills increase by £454
Britain’s inflation rate hit 9.4% in June, according to the latest data from the Office of National Statistics (ONS).
The rate marks a fresh 40-year high for the Consumer Prices Index – the metric by which the Government measures inflation. The country now has the highest inflation rate of any in the G7.
The new 9.4% figure is up 0.3% on May 2022, and 6.9% on June 2021. It is expected this number will continue to rise in the coming months, particularly when energy bills go up again in the autumn.
According to the ONS, the June increase was driven by mounting prices for food, as well as petrol and diesel.
Milk, cheese, and eggs were among the food products which rose in price the most. Dairy farmers have repeatedly called for help mitigating the increasing costs of production, so far to no avail.
Other upward effects came from the increasing price of vegetables, meat and other food products, like ready meals.
Some concern has already been levelled at how the rising cost of healthy food may impact the most vulnerable in society. In response, several supermarkets have introduced their own initiatives to improve access to such food.
These programs have not stopped the upward trend, however. According to the latest data from Kantar, Brits now face a £454 increase in their annual grocery bills because of inflation.
“Grocery prices continue to soar to near record-breaking heights and have jumped by another 1.6 percentage points since last month,” said Kantar’s Head of Retail and Consumer Insight Fraser McKevitt.
“This is the second highest level of grocery inflation that we’ve seen since we started tracking prices in this way in 2008 and we’re likely to surpass the previous high come August.”
McKevitt said the hike in grocery prices was increasingly turning consumers to own-brand products. Supermarkets’ own lines are growing by 4.1% this period, while sales of branded items have fallen by 2.4%, Kantar data suggests.
In a bid to even this out, supermarkets, manufacturers and suppliers are in constant talks regarding price. This has led to some products temporarily disappearing from shelves.
On the soaring cost-of-living, Helen Dickinson, Chief Executive of the British Retail Consortium, said: “Food prices have been sharply hit by soaring global commodity prices and the rising costs of animal feed and fertilizer, both exacerbated by the war in Ukraine.
“Across the board, non-food products are being impacted by haulage and shipping costs, whilst surging energy prices are making stores increasingly expensive to run.
“In the face of rising pressures in supply chains and operations, retailers are doing all they can to absorb as much of these costs as possible and look for efficiencies in their businesses.
“Retailers are expanding their value ranges to offer the widest variety of goods to those most in need, providing discounts to vulnerable groups, and raising staff pay. Until inflation is brought to heel however, it will be a difficult road ahead for households and businesses in the UK.”
Understand the details of the cost-of-living crisis with this Food Matters Live podcast: