Cost of steak goes up in supermarkets as food inflation rises for fourth month
Food inflation has continued its upward trend for the fourth month in a row this May, with rising wholesale meat prices pushing up the cost of steak on supermarket shelves, according to the latest data.
Despite this, shop prices overall are still in deflation, being 0.1 per cent cheaper than they were a year ago and maintaining the same level as in April, according to the British Retail Consortium (BRC) Price Index. Non-food items saw a further drop in deflation to 1.5 per cent, a slight decrease from April's figure of 1.4 per cent.
However, deflation has slowed down within certain categories, such as fashion and furniture, as retailers have started to scale back their heavy discounting strategies.
The BRC noted that electrical goods experienced a sharper fall in prices as shops attempted to stimulate consumer spending in anticipation of any potential repercussions from US tariffs. Yet food prices have increased by 2.8 per cent compared to last year, a rise from the 2.6 per cent recorded in April.
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The price of fresh food, in particular, has surged, now standing at 2.4 per cent higher than in May of the previous year, up from April's 1.8 per cent.
Ambient food inflation has seen a slight decline, dropping to 3.3 per cent from the 3.6 per cent observed in April.
Helen Dickinson, BRC chief executive, commented: "While overall shop prices remain unchanged in May, food inflation rose for the fourth consecutive month.
"Fresh foods were the main driver, and red meat eaters may have noticed their steak got a little more expensive as wholesale beef prices increased.
"With retailers now absorbing the additional £5 billion in costs from April's increased employer national insurance contributions and national living wage, it is no surprise that inflation is rearing its head once again.
"Later this year, retailers face another £2 billion in costs from the new packaging tax, and there are further employment costs on the horizon from the implementation of the Employment Rights Bill. Government must ensure the Employment Rights Bill is fit for purpose, supporting workers' rights while protecting jobs and investment for growth.
"If statutory costs continue to rise for retailers, households will have to brace themselves for more difficult times ahead as prices rise faster."
Mike Watkins, head of retailer and business insight at NielsenIQ, remarked: "Whilst shoppers are seeing savings at the checkout as retailers increase promotional activity, increasing prices is still an extra challenge to consumer spending alongside rising household bills.
"If consumer confidence remains weak as looks likely, then retailers may have to work harder to encourage shoppers to spend over the summer."
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