GettyImages 1245582079 1 2

Food inflation hits record 13.3% in Britain, indicating ‘another tough year’ ahead

Food inflation in Britain hit its highest rate in history in December, as Christmas spending soared as consumers actually took home less.

According to the British Retail Consortium (BRC) and the Nielsen Data Firm, annual food prices rose by 13.3% in December, up from 12.4% the previous month. The BRC said this was the biggest inflation recorded since they began tracking food prices in 2005.

BRC Chief Executive Officer Helen Dickinson She said for The Guardian: “It’s been a challenging Christmas for many households across the UK… 2023 will be another challenging year for consumers and businesses as inflation shows no immediate signs of abating.”

To put the numbers into context, this year’s holiday season saw British households spend £1.1bn more on groceries in December than in the same month last year.

While Christmas spending has reached a disk £12.8 billion, this was spent on fewer items than last year due to inflated costs. The retail analyst firm said that while overall spend was up 9%, actual sales were 1% lower than a year earlier.

The latest reading for headline inflation, set for November, stands at 10.7 per cent, which, although down from 11.1 per cent in October, is still at an almost 40-year high and more than five times the target 2 percent set by the Bank of England. Although the central bank raised interest rates to their highest level in 14 years (3.5%) to curb inflation, rising gas and energy costs kept inflationary pressures high.

As a result, UK manufacturers saw a further decline in output, with the S&P Global/Cips UK Manufacturing Purchase Manager Index falling to a 31-month low, falling from 46.5% in November to 45.3 last month , the fifth consecutive month. to see a contraction.

Addressing the issue on Tuesday, British Prime Minister Rishi Sunak She said that his government would try to halve inflation this year. Yet it was noticed that this was broadly in line with predictions already made by the Office for Responsibility (OBR).

Sunak left open schedules for his other pledges, including cutting illegal boat migration, admitting “many factors are beyond my control.” Downing Street later clarified that the pledge to halve inflation will be judged from the last quarter of 2023 versus the last quarter of 2022.

Follow Kurt Zindulka on Twitter here @KurtZindulka