Food takes a bigger bite out of household budgets
28th February 2023 10:18
by Myron Jobson from interactive investor
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interactive investor comments on Kantar UK grocery inflation.
Commenting, Myron Jobson, Senior Personal Finance Analyst, interactive investor, says: “Shoppers continue to be hit by a stubborn rise in grocery prices, which reached a new peak in the four weeks to February of 17.1% - heaping even more pressure on Britons. The recent shortage of salad items, such as tomatoes, peppers and cucumbers, threatens to make matters worse, with the full extent of the recent uptick in the price of these items yet to filter through.
“Going to the shop for groceries is taking a bigger bite out of household budgets at a time when many can least afford it, with increases to a host of domestic bills, not least energy bills and council tax set to hit in spring.
“More and more Britons are ditching premium brands and switching to cheaper, store-brand alternatives – but even prices on ‘value’ ranges are on the up, highlighting that there is seemingly no escape from higher prices. And many items that have not risen in price are shrinking in size. Known as shrinkflation, it means we are paying the same price for a smaller product.
“Escalating food prices eat into budgets and making it harder for many to maintain financial resilience and to save and invest to build wealth. Those living on the breadline are forced to take more aggressive steps to save. We have seen worrying reports of people forgoing meals because of the bumper cost of food.
“The headline grocery price inflation figure can dramatically differ from your own personal inflation number. As the cost of living continues to rage on, it is important to evaluate our spending habits. You must look at what makes sense for you – not an arbitrary measurement from anyone else.”
Key points:
- British grocery inflation hit 17.1% in the four weeks to 19 Feb, another record high, according to Kantar.
- Kantar said prices are rising fastest in markets such as milk, eggs and margarine.
- It said UK households now face an additional £811 on their annual shopping bills if they don't change their behaviour to cut costs.
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