London Daily

Focus on the big picture.
Thursday, Apr 24, 2025

Milk prices up 38% and sugar 42% amid fear of new rate rise

Milk prices up 38% and sugar 42% amid fear of new rate rise

We’re still on track, says Hunt despite surge in food prices
Food prices have sky-rocketed by a shocking 19 per cent, official figures revealed on Wednesday as warnings grew that more mortgage bill increases will further deepen the cost-of-living crisis.

Sugar was up 42 per cent, milk 38 per cent, olive oil 49 per cent, cheese 34 per cent and eggs 32 per cent in March, compared with a year earlier, fuelling the sharpest jump in food prices since August 1977.

Overall inflation stayed stuck in double figures, dashing hopes of an early end to the crisis.

The consumer prices index stood at 10.1 per cent last month — down from 10.4 per cent in February — the seventh month on the trot it has been in double digits, and defying City expectations that it would dip into single figures.

Economists swiftly warned that the Bank of England’s Monetary Policy Committee could be forced to hike interest rates from 4.25 per cent to 4.5 per cent in May, and possibly even higher later this year, to ensure inflation is being brought properly under control.

These increases will feed through into higher mortgage bills for millions of homeowners, and also drive up rents.

Inflation is still expected to fall sharply in the summer after energy costs dropped compared with their stratospheric peaks.

While this means that overall prices will not be rising so fast, it does not herald a fall in the cost of so many daily necessities, which are stretching the budgets of many households.

Experts still expect Rishi Sunak to meet his pledge to halve inflation by the end of the year.

But the UK’s rate of inflation is the third highest in the G20 group of leading economies, behind only Argentina and Turkey. Inflation in the US fell to five per cent last month while across the EU, price rises average 6.9 per cent.

After the latest prices data dropped at 7am, Chancellor Jeremy Hunt said: “These figures reaffirm exactly why we must continue with our efforts to drive down inflation so we can ease pressure on families and businesses.

“We are on track to do this — with the OBR forecasting we will halve inflation this year — and we’ll continue supporting people with cost-of-living support worth an average of £3,300 per household over this year and last, funded through windfall taxes on energy profits.”

But shadow chancellor Rachel Reeves said: “The question for families remains as real as ever — when will they feel better off under this Conservative government?

“And why, when the cost of living continues to bite, is the Government refusing to freeze council tax this year, paid for by a proper windfall tax on oil and gas giants?”

Karen Betts, chief executive of the Food and Drink Federation, said: “Food and drink price inflation remains stubbornly high because it takes some months for the rising prices that manufacturers pay to produce food and drink to filter through into the prices that shoppers pay on high streets and in supermarkets. And, while we have seen some ingredient and production costs start to come down from the exceptional peaks of recent months, those declines have not been consistent across the board.

“Meanwhile, many of the underlying drivers of inflation are still in play — with, for example, energy costs still double what they were in 2019 and rising labour costs.”

The high food inflation was partly offset by lower fuel costs, with petrol and diesel down 5.9 per cent against the same month last year after prices had spiked following Russia’s invasion of Ukraine.

In the City, traders are concerned that interest rates will have to go up at least twice more for the Bank of England to have any chance of bringing the CPI back down to its two per cent target.

“The smaller-than-expected fall in CPI inflation in March and the stubbornness of core inflation, which stayed at 6.2 per cent, suggests that the Bank of England will raise interest rates from 4.25 per cent to 4.50 per cent at May meeting,” said Paul Dales, chief UK economist at Capital Economics.

“The risk of that not being the last hike is growing.”

Ed Monk, associate director for personal investing at Fidelity International, said: “It’s now clear the UK has an inflation problem that is worse and more persistent than in Europe and the US.”
Newsletter

Related Articles

0:00
0:00
Close
Trump administration moves to BAN essentially ALL artificial food dyes in the USA food supply at RFK Jr.'s direction
Woman slaps man at sports game and gets herself and husband beat up
Pope Francis: head of the Catholic church who pushed for social and economic justice
China do not pay these tariffs - you pay it. This is new 145% tax you pay to the US government.
Nightlife in the streets of Manchester
In God We Profit
Cultural Battles in the Vatican: The Candidates in the Battle for the Holy See and Pope Francis's Testament
Global Leaders Pay Tribute to Pope Francis Following His Death
Wild Chimpanzees Observed Bonding Over Alcoholic Fruit
US Federal Reserve Chair Issues Warning on Tariff Impact
UK Prison Officers Demand Electric Stun Guns Amid Safety Concerns
China, China, China!
Australian National Charged as Mercenary for Fighting in Ukraine
Israel Considers Limited Strikes on Iran's Nuclear Facilities Amid Diplomatic Efforts
Prince Andrew Joins Royal Family Attends Easter Sunday Service at Windsor Castle
Saudi Arabia Offers Max Verstappen Unprecedented Deal to Join Aston Martin
Global Pistachio Shortage Amid Rising Demand for 'Dubai Chocolate'
Trump is assembling a coalition of Western leaders aligned with the MAGA vision, strengthening a unified front for global change
IMF Predicts No Global Recession Amid Trade Tensions
Here’s a police officer with a brilliant gift for swift education
"Some complain that we put thousands in prison. In reality, we set millions free."
This is Vienna, Austria in 2025.
Boeing Jet Returns to US from China Amid Tariff War
Canadian Federal Election: Candidates' Positions on US-Canada Relations and Donald Trump
Resentencing Hearing for Menendez Brothers Who Killed Their Parents Delayed Amid Legal Disputes
Australian Woman Gives Birth To Stranger's Baby In IVF Mix-up
US Sets Deadline for Russia-Ukraine Peace Deal Brokerage
Italy Introduces 'Sex Rooms' in Prisons for Inmates
California Launches Legal Challenge Against Trump Administration's Tariffs
"Groundless": China Dismisses Zelensky's Claims It's Supplying Arms To Russia
UK Psytrance Festival Cancelled Amid Local Protests Over Noise Concerns
French Far-Right Writer Renaud Camus Denied Entry to UK
UK Police Force Updates Search Policy for Trans Individuals in Custody
Italian Prime Minister Giorgia Meloni Meets with Donald Trump to Discuss EU-US Trade Tensions
Canada's Federal Party Leaders Engage in Final Debate Ahead of General Election
Ukraine and US Sign Outline of Minerals Deal
Fast Food Chain Refuses to Apologize for Online Comment About Katy Perry's Space Voyage
New York Attorney General Letitia James Faces Criminal Referral for Alleged Mortgage Fraud
Mark Cuban admits support for Trump executive order: ‘Gotta be honest’
US Senator Meets with Deported Immigrant in El Salvador Amid Custody Dispute
U.S. State Department Raises El Salvador’s Safety Ranking, Making It Safer Than France and Other European Nations
UK Government Assumes Control of British Steel's Scunthorpe Plant Amid Shutdown Threat
UK MP Wera Hobhouse Denied Entry to Hong Kong During Family Visit
Bangladesh Issues Arrest Warrant for UK MP Tulip Siddiq
China Urges United States to Cancel Tariffs Amid Escalating Trade Tensions
The Empire’s USD Pyramid Scheme Is Working Brilliantly—So Why ‘Fix’ It?
China Raises Tariffs on U.S. Goods to 125% Amid Escalating Trade Dispute
Elon Musk Reports $150 Billion in Projected Government Savings Amid Fraud Investigations
U.S. and Panama Finalize Defense Agreements Amid Canal Access and Chinese Influence Concerns
China Stands Firm Amidst Trade Disputes with the US: A Factual Analysis
×