For the first time in 20 years there's inflation in prices from the retail food sector in Ireland, according to a senior economist.
The food sector has experienced price compression in recent years due to the effect of the large discounters in the retail space.
In the year to January food prices have increased 2% in the Irish market, as a result of the import costs for food production increasing.
Economist Jim Power says price hikes in everyday food items is a new phenomenon:
Many customers will have experienced this price hike in terms of essentials such as heating and fuel but this is unprecedented when it comes to the food sector in Ireland.
The price hike is from the slow down in global production due to the covid-19 pandemic which led to a jump in demand which pushed the prices up further. Alcohol has not only increased due to minimum unit pricing but also the uptick in inflation.
Over the last twenty years grocery costs have fallen due to the competition effect from large discount food retailers however this pattern has changed this year due to inflation.
