UK food price inflation peaks at 19.2%

Annual food price inflation reached 19.2 per cent in March 2023, the highest rate of increase in food prices since 1977, according to a Scottish Government report on the cost of living crisis published on 12 February 2025¹. The same report states that UK consumer price inflation, as measured by the Consumer Prices Index, rose from under 0.5 per cent in February 2021 to a peak of 11.1 per cent in October 2022, at that point the highest rate for 41 years¹.

The National Institute of Economic and Social Research (NIESR), in a CPI tracker published on 19 April 2023, put food inflation at an annual rate of 19.1 per cent in March, up from 18.0 per cent in January, describing it as the highest rate for that category observed in over 45 years². NIESR said annual consumer price inflation fell from 10.4 per cent in February to 10.1 per cent in March, a seventh consecutive month of double-digit CPI inflation and the twentieth consecutive month above the Bank of England's target². The two organisations give slightly different figures for food inflation in the same month, 19.2 per cent and 19.1 per cent.

NIESR also reported that its measure of underlying inflation, which excludes 5 per cent of the highest and lowest price changes, rose to a new series high of 9.9 per cent in March from 9.7 per cent in February, while the ONS measure of core inflation, CPI excluding food, energy, alcohol and tobacco, remained flat at 6.2 per cent². Its measure of underlying inflation rose in each of the 12 UK regions, with the North of England at 10.70 per cent in March and Northern Ireland at 8.89 per cent².

The Scottish Government report sets out the wider path of prices and interest rates. It says the Bank of England raised interest rates 14 consecutive times from 0.1 per cent in December 2021 to 5.25 per cent in August 2023, and then reduced them twice in 2024, in August and November, from 5.25 per cent to 4.75 per cent¹. CPI gradually reduced from October 2022 to reach the Bank's 2 per cent target by June 2024¹. From early 2022 to mid-2023 the rate of inflation outpaced median wage growth in Scotland, and inflation rose faster than benefits were uprated¹.

On food specifically, the report says the number of Scots reporting cutting back on essentials such as food peaked at 24 per cent in February 2023 before falling to 15 per cent by December 2024, and that in December 2022, 62 per cent of households who said they were managing less well financially reported cutting back on essentials such as food¹. Among individual foods, it cites annual increases to April 2023 of 85 per cent for sunflower oil and 83 per cent for cucumbers¹.

Why it matters for households

Food is a regular, unavoidable purchase, so a rate of increase near 19 per cent feeds directly into weekly shopping bills. NIESR noted that there is no government support to help households offset this cost, and that lower income households, who spend a greater part of their incomes on food, are hit disproportionately². The Scottish Government report records that inflation outpaced median wage growth in Scotland from early 2022 to mid-2023 and rose faster than benefits were uprated, meaning household costs were increasing faster than average household incomes over that period¹.

The report also notes that the large increases in inflation over the three years to 2025 have effectively been locked in, and that lower inflation does not mean prices are falling, only that they are rising less quickly³. Energy and food price levels remained notably higher than in 2021 even after the pace of increase stabilised¹. For mortgage holders, the same report links higher interest rates to rising mortgage and rent costs, noting that by the third quarter of 2024 the number of regulated UK mortgages entering arrears had increased by 36 per cent compared with the first quarter of 2022, though still below the pandemic spike and the 2008 peak¹. It adds that low income households experienced higher inflation in the earlier phase of the crisis, while by mid-2023 high income households, more likely to be homeowners, were experiencing higher rates as interest rates rose¹.

What happens next

The Scottish Government report was published on 12 February 2025 and is a retrospective analysis rather than a forward schedule¹. It records that the Bank of England reduced interest rates twice in 2024, in August and November, from 5.25 per cent to 4.75 per cent¹. No further dated steps are set out in the material.