The rate of inflation for food prices in the UK has reached its highest point in 45 years

The cost of living increased more than anticipated last month due to the steep hike in prices for bread, cereal, and chocolate. Inflation, which is a measure of the rate at which prices are rising, dropped to 10.1% in the year to March, down from 10.4% in February.

Although it was expected to fall below 10%, the upward trend in food prices continued and surged at its highest rate in 45 years. It is important to note that declining inflation does not imply falling prices, but rather a slowdown in the rate of price increases.

While food prices are decreasing globally, according to Grant Fitzner, the chief economist for the Office for National Statistics that releases these figures, this has not yet translated into price reductions.

“There’s been some strong upward movement in food prices and you would expect to see that reflected in supermarkets but we’re not there yet,” he told BBC Radio 4’s Today Programme.

When questioned about the possibility of sustained double-digit inflation for another month with ongoing high food prices, Fitzner stated that it was possible but not forecasted. Chancellor Jeremy Hunt expressed confidence that inflation would significantly decrease by the end of the year.

He added: “We have a plan and if we’re going to reduce that pressure on families, it’s absolutely essential that we stick to that plan, and we see it through so that we halve inflation this year as the Prime Minister has promised.”

But Rachel Reeves, Labour’s shadow chancellor, said: “The reality is that under the Tories our economy is weaker, prices are out of control and never have people paid so much to get so little in return.”

Compared to other Western countries like the US, Germany, France, and Italy, inflation in the UK is still higher. This is due to several factors, including the UK’s exposure to increasing wholesale gas prices, its dependence on imported food products, and worker shortages and wage increases.

One of the main drivers of inflation in March was the ongoing surge in food prices. The conflict in Ukraine has driven up the prices of grains and vegetable oils, while rising transport and packaging costs are making imports more costly.

In March, the most significant increases were observed in the prices of products such as olive oil (up 49%), milk (up 38%), and ready meals (up 21%). While food prices remained high, petrol prices fell, providing some relief for drivers. Unleaded petrol prices hit their peak at around £1.90 in July and dropped below £1.50 in March.

According to Simon Mellin, the founder and CEO of The Modern Milkman, a milk delivery service, the food industry has experienced rising costs in recent months, with prices for milk, eggs, and packaging all increasing. He expects food prices to stabilize soon, but they will remain significantly higher than they were last year.

“I’m really unsure if food prices will drop as much as everyone expects,” he told the BBC.

“I expect some reductions but I wouldn’t personally expect huge reductions in the next twelve months.”

He said he was trying not to pass higher prices onto customers, but added that it was a balance the business had to tread.