UK inflation rises to highest level in almost 30 years at 5.4%

[dutchman]

Beef drives food inflation to highest in a year



Higher beef and fresh produce prices has pushed UK food inflation to an annual high, according to industry data, with the boss of one steakhouse chain telling the BBC the cost of the meat had risen by a fifth.

Food prices rose 2.8% in the year to May, the highest annual rate since May 2024 when food inflation was 3.2%, according to the British Retail Consortium (BRC), which represents supermarkets and other retailers.

Farming industry experts said beef prices in particular have been rising due to high demand and low supply caused by lack of government support.

Tomas Maunier, co-founder of steak restaurant chain Fazenda, said the meat industry faced "tough times".

Mr Maunier, whose Brazilian-inspired steakhouse chain has eight restaurants across the UK, said his firm had passed on about 2% of increased running costs to customers.

"Beef in particular has gone up about 20% in the last 12 months. A big chunk of that has happened in the last six but businesses cannot pass it all on to our guests," he added.

Mr Maunier added that an increase in production costs and an increase in the national minimum wage was also pushing up overall costs, which could be passed onto consumers.

Nick Allen, chief executive of the British Meat Processors Association (BMPA), said competition between supermarkets had previously been keeping the price of beef down, so it was only a matter of time until customers were hit by cost increases.

"Its not surprise. The farm price for beef has been going up and up to the point that its now at record levels," Mr Allen said.

He warned it was a "real struggle" for the industry to keep up with demand for beef, and claimed that "government schemes have not supported production but environmental schemes instead".

Helen Dickinson, chief executive of the BRC, said red meat eaters "may have noticed their steak got a little more expensive" this month.

Jilly Greed, a fourth generation arable farmer and suckler beef producer in Devon, told the BBC: "It is entirely the maths - it's about supply and demand."

"There's a 5% shortfall in cattle on the land, and a 1% increase in consumer demand, and the combination of those factors have really brought price increases," she added.

Ms Greed said price increases have affected the whole supply chain.

"The base product is the highest it's ever been, and sooner or later that has to filter through to the consumer," said Mr Allen.

The Agriculture and Horticulture Development Board, which is funded by farmers and growers, said UK cattle prices have been rising at "unprecedented levels" since the start of 2025.

Its latest beef market update says some of the price rise faced by farmers is feeding through to shoppers - but it said not all of this is being passed on.

[dutchman]

Why is the ONS saying inflation has gone down?

The rate of inflation remained flat at 3.4 per cent in May – still well above the Bank of England’s 2 per cent target. Bizarrely, the Office for National Statistics (ONS), in their figures released this morning, claims this is down from 3.5 per cent the month before, even though just a couple of weeks ago they admitted that figure was overstated due to an error. Because of a policy not to revise inflation figures, that error lives on – leading them to announce the fiction that inflation has fallen. The reality is it has not.

The result of stubbornly sticking to this no-revisions policy is a slew of misreporting about Britain's economy. The Today programme told us inflation was ‘cooling’, and news websites are already parroting the ONS line that inflation has fallen. That may reassure people, but it is a complete fiction. It makes you wonder why the ONS even bothered telling us they’d got the figures wrong last month.

As for what supposedly drove the fictitious fall, the ONS points to air fares being down compared with a large rise at the same time last year – though that previous reading coincided with Easter, when prices tend to surge anyway. So who knows what’s really going on there. Petrol and diesel prices do seem to have come down, but that was offset by rising food prices – particularly chocolate and meat. Furniture and household appliances were up too.

It makes you wonder why the ONS even bothered telling us they’d got the figures wrong last month.

The consensus among economists was that the figure would fall to 3.3 per cent. The fact that it has not makes it very unlikely that the Bank's nine-member Monetary Policy Committee will cut rates when they meet tomorrow. Instead, markets expect them to hold rates at 4.25 per cent before beginning to cut them again in August.

The war in the Middle East continues to threaten to make inflation even stickier as oil and gas prices rise. Professor Joe Nellis, economic adviser at accountancy firm MHA, says this means the Bank might not achieve the 2 per cent target until 2027.

In the end, while the headlines may offer false comfort, the stubborn reality of inflation remains. The ONS’s reluctance to correct its errors risks further undermining trust in official statistics and just makes them look ridiculous. The Bank of England, meanwhile, remains caught between the need for caution and growing pressure to ease rates in the face of a stagnating economy. This is a balancing act that may define the months to come.

https://www.spectator.co.uk/article/why-is-the-ons-saying-inflation-has-gone-down/

[rebbonk]

Having worked with the ONS, I wouldn't **** on them if they were on fire!