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Shoppers are being hit by a surge in the cost of groceries despite falls in the headline rate of inflation, according to figures released today.
Shop price inflation rose last month because of the increasing cost of meat, fresh produce and tinned goods, with overall prices up at an annual rate of 9 per cent, from 7.5 per cent in January.
But the CPI measure of inflation has fallen to 3 per cent, down from a peak of 5.2 per cent in September last year, and is forecast to drop to near 0 per cent in the coming months.
Overall shop prices rose at an annual rate of 1.9 per cent, up from 1.1 per cent in January, a survey from the British Retail Consortium (BRC) shows.
Consumers shopping for non-food items are still benefiting from falling prices, as inflation for these items was -1.7 per cent, but prices are declining less rapidly than in January when inflation was -2.1 per cent.
Stephen Robertson, the director general of the BRC, said that the slump in sterling had driven up demand for British produce overseas, which is "restricting supplies at home and pushing prices up".
The cost of fresh food was 10.4 per cent higher in February than the same month last year. But the cost of ambient goods, such as tinned food or ready meals was also pushed higher as the cost of imported food rose because of the weak pound. "Exchange rates have affected a high proportion of ready meals as ingredients are sourced from abroad," the BRC said.
The cost of an average basket of 24 staple items in the supermarket was 17 per cent higher last month than in February 2007, a separate survey by mysupermarket, the price comparison website, showed recently.
But economists said that the figures were unlikely to deter the Bank of England from proceeding with rate cuts tomorrow.
Howard Archer, the chief UK and European economist of IHS Global Insight, said: "While the Bank of England will note the second successive rise in the shop price deflator in February and the apparent upward impact of sterling's weakness, this is most unlikely to deter the MPC from cutting interest rates again tomorrow and announcing its intention to start quantitative easing."
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