Britain has highest food and energy inflation in Europe, OECD says

Britain has the highest food and energy inflation in western Europe, according to the OECD.

 
The OECD said food prices in April in the UK were 4.6 per cent higher than the same month a year ago.

Fears over the huge squeeze on cash-strapped households rose yet again after shock figures from the Paris-based think tank.

The OECD said food prices in April in the UK were 4.6 per cent higher than the same month a year ago.

This compares with 3.7 per cent in Germany, 1.6 per cent in France and just 1 per cent in the US.

Energy inflation in the UK was put at 2.2 per cent – more than four-times the rate of increase in Germany. In nearly a dozen European countries energy prices fell in the month – with France, Belgium, Denmark and Spain benefiting from a decrease.

Economists said UK consumers may be suffering from the low pound but also less competition than other markets.

Ross Walker, chief economist at the Royal Bank of Scotland, said: "The concentration of the big four supermarkets in the UK must given them pricing power."
Today's figures came just weeks after the OECD claimed rising prices were hitting the amount of spare cash in Britons' pockets. Britain has fallen from fifth to 12th on a global list of wealth based on disposable incomes since the credit crisis began.
The Office for National Statistics puts the country's official inflation rate 2.4 per cent. The Bank of England has missed its 2 per cent target since December 2009.
Supermarket industry insiders insist that inflationary pressures faced at the end of last year on items such as wheat and meat were beginning to ease. One stressed that promotional activity had never been higher and that UK customers get some of the best deals in Europe.
The OECD said that overall inflation in the UK had slowed from 2.8 per cent to 2.4 per cent in April. But the index dropped to 1.2 per cent in Germany, 1.1 per cent in Italy and just 0.7 per cent in France.