Food inflation across rich nations has dropped to its lowest level since before Russia’s invasion of Ukraine, easing the global cost of living squeeze. After two years of surging prices, consumer food prices in 38 industrialized countries fell to 5.3% in February, down from 6.2% in January. This decrease is attributed to easing global food commodity prices such as cereals and dairy products. In the UK, food price inflation hit a two-year low recently.
Carlos Mera, head of agricultural commodities at Rabobank, states that the worst of high food inflation is behind us, as agricultural commodity prices have significantly dropped in the last two years. Although falling inflation doesn’t mean prices are dropping, they are rising at a slower rate than before. Many advanced economies have seen food inflation drop to around half of its recent peak.
In other news, the UK retail sector has faced challenges, with a high number of insolvencies in the past year due to weak consumer spending and rising costs. The UK state pension and benefits have increased, with pensioners receiving an 8.5% rise and other benefits increasing by 6.7%.
In Germany, exports have dropped by 2% in February, with demand from other European countries softening. On a more positive note, the UK economy is showing signs of growth, with output from businesses reaching its highest level in almost two years. Deloitte reports that UK chief financial officers are more optimistic about their businesses’ prospects, with uncertainty levels decreasing.
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