BRC: Food price inflation surges

| July 6, 2011 | 0 Comments

According to the British Retail Consortium (BRC), shop price inflation rose in June on the back of growing food prices.

The BRC said shop price inflation surged to its highest rate since October 2008 in June.

Higher petrol and commodity costs lifted shop prices to 2.9% in June from 2.3% in May while food inflation rose to 5.7% from 4.9% - the biggest gain since May 2009.

On a monthly basis, meanwhile, prices rose by 0.5% with food prices growing by 0.6%, the Consortium said.

The gains are attributed to sharp rises in world commodity prices, as well as the effects of the weak pound and higher VAT – factors “beyond retailers’ control”, said the BRC.

Retailers are struggling to pass on higher wholesale costs and well-known names such as Habitat, TJ Hughes and Jane Norman have all entered administration in the last few weeks.

The Consortium is expecting further upward price pressure – particularly on the cost of non-chilled goods as a result of rising grain prices.

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