FOOD-PRICE inflation is showing signs of a gradual return “to more normal levels”, according to a supermarket chain.
Channel Island Coop chief executive Mark Cox said the company’s own data indicated a “significant reduction” in the rate of increase in food prices.
His comments come shortly after the Office for National Statistics calculated the year-on-year inflation rate for food and drink in the UK at 1.5% for June, down from 1.7% in May.
It is the lowest annual rate seen since October 2021, when it was 1.3%.
Jersey’s latest RPI figures are due to be published tomorrow.
Mr Cox noted that food inflation had been on “a steady decline” recently.
He said: “Our internal metrics indicate a significant reduction in food inflation, down to 1.57% from 5.65% at the start of the year.”
He continued: “While this still signifies an increase in food prices, the rate of increase is considerably lower and suggests that food-price inflation is starting to gradually return to more normal levels.
“We are committed to transferring the benefits of cost price reductions to our customers as they filter through the supply chain.”
He explained that other factors such as a slower rise in agricultural feed and fertiliser costs, along with a decrease in electricity, gas, and other fuel prices in the UK, gave the supermarket “optimism” about whether the trend would continue.
“We remain committed to easing the cost-of-living pressures on our members and continue to implement initiatives like our price-drop campaign, member reward discount weekends, and trials of exclusive member pricing promotions,” he added.
British Retail Consortium economist Harvir Dhillon warned that the impact of climate change on harvests, as well as rising geopolitical tensions, “could increase commodity prices and translate into higher inflation rates” for both the UK and Jersey in the future.
But he also said that: “With UK food inflation falling to 1.5%, we hope that inflation in Jersey will also fall over the coming quarters, given its reliance on UK imports.”
