UK inflation unexpectedly stays at 2.8% with higher transport costs offset by slower food price rises – business live

Key events Despite the easing to food inflation to 2.2% last month, the lowest since December 2024, Karen Betts, chief executive of the Food and Drink Federation, warned that food inflation could still head higher in the coming months. double quotation mark It’s good to see an easing of food inflation in May, but consumer prices still don’t reflect the inflation caused by the closure of the Strait of Hormuz. It generally takes several months for the increased costs paid by farmers, processors and manufacturers to filter into raised prices at the tills, not least because of the widespread use of long-term contracts for energy and ingredients. But manufacturer input costs are rising, including for transport, packaging and energy, and we expect food inflation to pick up this year and into next. Uncertainty is the new norm for food producers, which is driving up the overall cost of food production. This makes it all the more important that government acts where it can – to prioritise food manufacturers for energy support and by prioritising and rationalising regulation, freeing businesses to invest in vital long-term resilience. Prices rose the fastest for beef and veal (9.4%), offal (9.2%), preserved fruit (9.0%) and confectionary products (8.8%). Prices fell for 15 categories, with the largest drops for flours (-6.1%), olive oil (-4.2%) and jams and marmalades (-3.0%). Transport costs rose at an annual rate of 6.8%, up from 4.5% in April and the highest since December 2022. …