Food prices rose almost 5 per cent last month driven by wheat and milk, new figures show today.

Compared with the same month last year, prices were up 4.7 per cent. They rose 0.7 per cent above the March figure, according to latest figures from the British Retail Consortium and pollsters Nielsen.

The annual rise is the sharpest spike since the two began collating the index in November 2006.

However, the sharp rise in food costs were offset by falls in the cost of electrical goods, which fell by 4.6 per cent. The cost of non-food goods fell by 0.2 per cent in April and 0.6 per cent year on year, the biggest annual drop in non-food prices since September last year.

This resulted in an overall increase in shop prices of 0.1 per cent in April, and 1.2 per cent over the year.

Stephen Robertson, the director general of the BRC, said: "Retailers are succeeding at protecting customers from the full force of increasing commodity, energy and transport costs by absorbing most of those increases themselves, even when it’s at the expense of their own margins. There is no doubt food prices would be much higher if it wasn’t for retailers’ efforts to contain them.”

Mr Robertson said: “Food prices have gone up, but the retail price of food is rising much more slowly than the farmgate price of commodities such as wheat and milk.

Mr Robertson said: " Electricals are five per cent cheaper than a year ago."

Meanwhile, the BRC’s shop price index for London showed prices in the capital rose by 0.4 per cent in April from March’s unchanged reading, pushing the annual rate up from 1.8 per cent to 2.2 per cent.

Mr Robertson said that this monthly reading is the second lowest over the last 10 months.

“This is a reflection of widespread discounting in response to customers reining in spending over worries about job security and turbulence in the financial markets,” he said.

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