Grocery prices rise as world food prices increase
Grocery shopping costs up 5.8%
Friday, 30 May 2008 11:11
An average shopping basket of goods cost 5.8 per cent in May compared with the beginning of the year.
In total British shoppers are now spending £514 million a month more on their shopping, according to research from Verdict.
Groceries now account for 13 pence in every pound spent by shoppers.
The price rises, combined rising energy and fuel process, mean spending on leisure activities is being squeezed, and for many people inflation now feels far higher than the government's official rate.
"Food shopping is something most people do regularly, so they immediately notice increases in prices more than they do in other areas," said Neil Saunders, consulting director at Verdict.
"For many, the price of the weekly food shop is the real measure of inflation - it's what they react to when they make decisions about the household budget and what to spend on other things."
He added while grocery prices were by 5.8 per cent, wages had risen by two per cent.
The prices of fresh fruit and vegetables are up 15.9 per cent, while meat and fish rose seven per cent. Dairy rose 6.2 per cent. However ready meals/prepared food fell in price by 5.1 per cent.
The pressure is particularly acute on those with low earnings - as a greater proportion of their incomes are spent on food.
"For those at the lower end of the income scale, increases in food prices can be very difficult to cope with because they aren't many other areas where they can cut back to make savings," Mr Saunders said.
"It's one of the reasons the abolition of the 10 pence rate of tax was seen as a slap in the face for poorer families - it came at a time when they are already struggling to buy even basic items."
Food prices are now expected to continue rising throughout 2008 and into 2009.
"There is very little sign that the price of food is going to moderate or fall" concluded Mr Saunders.
"The price increase is partly a result of global demand outstripping supply and there is very little that can be done to remedy that imbalance over the medium term."