Economics bulletin 07 July

Date : 07 July 2023

Your overview of economic and policy news with a focus on the food and consumer goods industry. Featuring the latest developments and guidance on the rising cost of living, the Ukraine crisis, labour shortages, policy developments and adapting to a new relationship with the EU.

Food spending concerns

IGD’s latest consumer research has highlighted the pressure the economic climate is having on those with the lowest incomes. 53% of all adults plan to cut spend on food and grocery shopping in the next few months, increasing to 66% of those on the lowest incomes.

To hear more from our experts on the impact the cost of living crisis is having on consumers, tune into our upcoming Viewpoint webinar Persistent inflation, politics and labour challenges: Why 2023 is proving brutal for business leaders.

You can register for your place for free here.

Shopper confidence rises

IGD’s Shopper Confidence index rose in June to -12, the highest level since the end of 2021. This compares with a score of -24 a year ago. The increase is mainly being driven by fewer consumers expecting food prices to rise in the next 12 months.

ShopperVista subscribers can read the full Shopper Confidence Index report.

Energy bill warning

The average household is now paying £426 a year less for their energy as the energy price cap came into force at the beginning of July replacing the Energy Price Guarantee.

The head of the International Energy Agency has said that there is a risk that energy prices could rise this winter if “the Chinese economy is very strong, buys a lot of energy from the markets and we have a harsh winter”.

Change to Extended Producer Responsibility

There has been minor changes to the timescales for Extended Producer Responsibility. Large organisations will now be able to create an account for their organisation from August 2023 and are now required to report their packaging data for the period January to June 2023 before October 2023.

Hottest June on record

The Met Office has confirmed that June 2023 was the hottest June on record for the UK. The average mean temperature of 15.8°C surpassed the previous record by 0.9°C. It was estimated that climate change has made the chance of surpassing the previous record at least twice as likely.

Challenging growing conditions, due to extreme heat or drought, could impact crop yields and may extend food price inflation.

To read our latest food inflation forecasts, please see here.

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