Food inflation is forecast to continue rising, potentially reaching six per cent by the end of the year, making Christmas shopping more expensive.
The Bank of England has warned that increasing food prices could push overall inflation to four per cent, having already cut interest rates for the fifth time this year.
Business leaders attribute rising inflation partly to Labour’s autumn tax increases, such as higher employer national insurance contributions, which force retailers to raise prices.
The British Retail Consortium estimates that government policies, including a rise in the national living wage and a new packaging tax, have added an extra £7 billion to retailer costs this year.
A poll by the BRC found that two-thirds of retailers anticipate further price increases this year, with many having already raised prices or implemented hiring freezes.
