Jump in food prices keeps inflation up

Posted on August 20th, 2010 | Categories - News

The one per cent rise in food prices between June and July is one of the factors keeping inflation above the Bank of England’s two per cent target.

The record increase covers the price of vegetables, meats, fruits and soft drinks, according to statistics revealed by the Office for National Statistics.

The research concluded that the average price of fruit has gone up by 9.9 per cent and the cost of chocolate has gone up by five per cent.

Ann Robinson, director of consumer policy at price comparison website Uswitch, said: “For those who spend a high proportion of their income on food, life is getting very tough. Luxuries have been the first to go, but the current climate is forcing one in four people to also cut back on food. This could get worse before it gets better”.

Uswitch research highlights that people are using credit cards, overdraft facilities and loans to cover the cost of living, which includes grocery shopping.

Economists have said that extreme weather conditions and the increase in natural disasters, such as the recent floods affecting millions in Pakistan, may lead to an increase in the production cost of raw ingredients, which could push global food prices up even further.

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