Data from Verdict Consulting’s latest Food Price Tracker shows that the price of a full breakfast for a family of four has started to get cheaper, the first time it has fallen since January 2008. On average, the cost of making breakfast is 5p cheaper in June than it was in May.
Although the reduction is small, it shows food price inflation is starting to go in the right direction. Nevertheless, the decline is nowhere near sufficient to undo months of price increases, and compared to June 2008 the price of breakfast remains £1.14 more expensive.
Leading the fall in prices are sliced white bread (down by 3.1% since last month), strawberry jam (down 2.7%) and bacon (down 2.3%). Some items, including Corn Flakes and butter, have recorded slight price increases.
Neil Saunders, consulting director at Verdict, said: “The fall in the price of breakfast is only small, but it shows things are finally going in the right direction. And the good news is that we expect to see stronger falls as we move through the year.”
Verdict forecasts that, by the end of the year, breakfast should be about 84p cheaper.
The overall inflation picture is less rosy, with shoppers paying almost the same for their groceries in June as they did in May. The price of a basket of 100 regularly purchased items was more or less static, rising by +0.1% from May to June. This follows two months of price falls.
On a yearly basis, food price inflation in June reached its lowest level so far this year at 6.5%. The year-on-year increase is now less than half that reported in earlier months, when inflation peaked at 14.1%.
Rates of inflation remained mixed across the basket, with categories such as dairy and laundry remaining strongly deflationary on last year, and other categories such as health & beauty and frozen foods showing lower rates of inflation compared to earlier parts of the year. However, household goods and fresh fruit & vegetables remain stubbornly inflationary.
The food price inflation tracker is compiled by Verdict Consulting. It’s based on a sample of 100 items purchased on a regular basis by a typical family. Items cover 13 separate product categories.
Source: Verdict Consulting
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