Inflation rate has returned to 10.1% as the cost-of-living crisis escalates, official figures out today showed.
Food costs have now risen for the 14th month in a row, which is 14.6% is the highest rate since 1980.
Retail expert Dr Gordon Fletcher from the University of Salford Business School warned that our shopping baskets are being hit doubly hard, with rising process and shrinking quantities combining to create real difficulties for a lot of people.
Dr Fletcher said, “As inflation returns to the reported rate from July it is a timely reminder that these are figures last seen in the year of the Prince of Wales’ birth and the premiership of Margaret Thatcher.
“Although the rate is calculated from a range of different factor the signals are that households will be directly feeling the pinch over Winter. With the overall increase moving from last month’s 9.9% to 10.1% a significant contributor to this number is the result of increasing food prices. We are paying around 14.6% more for our shopping basked than a year ago and that is a direct drain on household budgets.
“This shift in day-to-day costs is felt differently in different households. Lower-income households have to spend more of their available income on essentials including food, fuel and power.
“As costs continue to increase there are fewer ways for low-income households to cut back on non-essential costs – such as visiting restaurants or leisure activities – with the result that more people are pushed across the poverty line.
“A further effect with the rising prices of food items is the tendency for manufacturers to reduce the physical size of the items to maintain a price point or at least the apparent rise in costs.
“We simultaneously have inflation and shrinkflation happening at the same time. So while a slightly shorter or thinner chocolate bar could be seen as a healthy decision a haphazard reduction in size could force shoppers to buy two smaller items when previously one item was enough to feed a family.
“Driving costs up even further for those least able to pay for this change in packaging. Pay careful attention at your next shop. It will cost more, but it will also probably weigh less than it did a year ago.”