The price of fresh food jumped by more than 10 per cent in the year to July as producers struggled with high oil and commodity prices.

The cost of fresh produce rose by 2 per cent last month, pushing the annual rise to 10.8 per cent, according to the shop prices index from the British Retail Consortium (BRC) and Nielsen.

Overall food prices were 9.5 per cent higher in July than a year earlier, up from a 7 per cent rise in June, piling the pressure on already hard-pressed consumers.

The BRC said that food producers were being forced to increase their prices as the cost of pork, cooking oils and fats went up. It added that high oil prices were also forcing up the cost of transport, refrigeration and fertilisers. Stephen Robertson, director-general of the BRC, welcomed recent falls in the oil price, but said: “Most retail costs remain sharply up on a year ago and are still rising.”

Despite these price pressures, retailers were not passing on the full increases to customers, he said.

Total shop price inflation was 3.2 per cent in the year to July, up from 2.5 per cent in June. This was the largest rise since the survey began in December 2006.

Non-food prices edged up again in July, by 0.1 per cent year-on-year after a 0.2 per cent increase in June.

However, the cost of electrical goods and clothes fell, pushed lower by sales and discounting. Prices of electrical goods fell by 3.3 per cent in the year to July, while clothing and footwear fell by 2.7 per cent.

Howard Archer, of Global Insight, said that retailers increasingly would be unable to raise prices as consumers reined in their spending, opening the way for eventual cuts in interest rates by the Bank of England. However, he said: “Given current inflation levels and risks, we suspect that the Bank of England may well be reluctant to cut interest rates until 2009.” The Bank is widely expected to keep rates on hold at 5 per cent today.

Shop prices rose by 3.8 per cent in Scotland in the year to July, as higher confidence among consumers allowed retailers to increase their prices further, the BRC said.

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