Food inflation in the UK experienced a modest rise last month, increasing 0.1 percentage point to reach 2%, as confirmed by the latest statistics from the Office for National Statistics (ONS).
Despite this minor increase in food inflation, certain meat products, specifically pork, lamb, and beef, have seen a decrease in price over the past month. This comes as a somewhat surprising development given the broader economic pressures at play.
The overall consumer price index also saw an increase, rising to 2.6% in November from 2.3% in October. Meanwhile, the cost of alcoholic beverages and tobacco recorded a more pronounced hike, soaring by 1.6 percentage points to 6.9%.
Kris Hamer, Director of Insight at the British Retail Consortium, noted the efforts of retailers to maintain affordability for customers during the festive season, despite global price pressures. He highlighted the significant £7 billion rise in costs due to factors such as higher employer National Insurance contributions, increases to the National Living Wage, and new packaging levies.
Retailers are keenly observing the government’s proposed changes to business rates, with an emphasis on ensuring that these do not result in higher rates for any store. Protecting shops from increased rates is seen as crucial to helping retailers invest in maintaining open stores and keeping prices low.
Last month, over 70 UK retailers cautioned Chancellor Rachel Reeves that the decision to increase employers’ National Insurance contributions would likely lead to unavoidable job cuts and price increases, further illustrating the challenging landscape retailers navigate.
The recent trends in meat pricing amidst a slight rise in food inflation reflect the complex economic challenges faced by UK retailers. As they strive to keep prices affordable for consumers during the festive season, the impact of increased operational costs and government fiscal policies will be critical to observe in the coming months.
