Food inflation growing despite fourth monthly fall in wholesale electricity
Fruit and vegetables have risen by just under 18% annually, with fish, grain and starches also exhibiting the largest wholesale price increases in the last twelve months.
Wholesale electricity prices have continued on a sharp decline for a fourth consecutive month, falling by 13.5% since March and by more than 42% on an annual basis, with core inflation still contributing heavily to rising prices.
Despite hefty falls in electricity since its initial surge last year, clothing, building materials and construction products all continue to rise on an annual basis, with the foods, beverage and tobacco index also up by 1.1% since April, 2022.
Sticky core inflation has raised the risk for yet another interest rate hike from the European Central Bank, with President, Christine Lagarde saying on Sunday that the "fight to tame inflation isn’t over and more action is still needed."
“We are not done yet, we are not pausing based on the information I have today. Inflation outlook is too high and for too long.”
Fruit and vegetables have risen by just under 18% annually, with fish, grain and starches also exhibiting the largest wholesale price increases in the last twelve months. While dropping by 2.6% in the last month, dairy products still remain up on an annual basis, increasing by 6.8% since April 2022.
In addition, core products including building materials and clothing have also risen by 11.7% and 8.8% respectively, prompting discussions of yet another ECB rate hike, which would be its eighth in just under a year.
Domestic producer prices for manufactured goods were on average 7.8% higher in April 2023 compared with a year earlier, while producer prices for exported goods fell by 1.2%.
Additionally, producer prices in the Food Products index dropped by 2.2% in the month, but this was still 0.8% higher overall than in April 2022.
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