But here in the UK we have certain unique factors contributing to the CoL:
The most recent inflation figures available at the time of writing show that the UK experienced an unexpected rise in the overall rate from 8.8% in January 2023 to 9.2% in February 2023. This meant that the UK had the highest inflation of the G7 advanced economies in February (as Italy fell from 10.0% to 9.1% and Germany remained at 8.7%). For the UK, the persistence of these inflationary pressures in early 2023 is attributable to the very high energy costs discussed above, but also to still rising food prices (to an annual growth rate of 18.2% in February) (OECD, 2023c). The factors behind this food cost inflation are multifaceted, including the disruption to supplies of staple commodities related to the Russian invasion of Ukraine. However, recent analysis also points towards the trade barriers introduced by the UK leaving the European Union Single Market and Customs Union in January 2021 having contributed to increasing food prices in the UK over the past two years (Bakker et al., 2022).