CONSUMERS face months of price hikes as food now hits record levels along with energy.
However, the fact that the Houses of the Oireachtas will rise for summer break today means it will be good
in the fall, before there are any new government moves to take some of the pressure off.
Households will see the cost of living crisis worsen as prices continue to rise in the coming months.
The warning comes after official figures showed prices rose 9.1 percent in the year to June, the fastest price increase in almost 40 years.
Food inflation is now nearly 7 percent, electricity prices are up 40 percent and the cost of heating oil has more than doubled.
The news brings fears that consumers will cut spending, a move that could plunge the economy into a slump.
This would shatter current expectations that this country can avoid a sharp slowdown in the coming year.
Meanwhile, warnings have been raised that skyrocketing inflation is affecting families’ mental health.
Fianna Fáil TD John Lahart told the Dáil some families are now reluctant to spend money on new shoes, an indication not all are doing well.
There is so much negative economic talk that people are scared of spending, he said.
Consumers’ group chief Michael Kilcoyne said the higher prices went, the more VAT the government would pay.
He said some people would end up having to choose between buying groceries and heating their homes if the weather worsened.
No one received salary increases that matched the level of price increases. This means there is an urgent need to cut taxes, he said.
Taxback.com director Barry Cahill said the pressure on the cost of living is causing anxiety issues among workers.
“Employers are looking for ways to help their employees by taking care of their mental and financial well-being through workplace initiatives and programs whenever possible,” he said.
He said spending less was the most common measure people said they were planning to try to stem the impact of runaway prices, which would affect the broader economy.
Mr Cahill said when his company asked its taxpayers’ database about it, it found that nine out of ten people reported feeling the effects of rising home and transport fuel costs since the beginning of the year.
Eight out of ten respondents said they felt their alcohol, tobacco and grocery bills increase.
Goodbody Stockbrokers economist Dermot O’Leary warned that inflation will hit 10 percent next month. This month, the central bank forecast that inflation could peak at over 10 percent in the coming months.
Mr O’Leary said the latest inflation figures showed the mix of price pressures was changing, with food inflation now a key issue alongside energy cost increases.
“In terms of price hikes, we still have a little work to do and there is extension of inflationary pressures,” he added.
The risk, he said, is that inflation will pick up
persistent after not only the energy costs have increased.
Figures from the Central Statistics Office show that food prices rose 6.8 percent last year.
Prices for flour, pasta, chicken, beef, fish, butter, margarine, milk and fruit
all increase by double digits.
Overall prices have skyrocketed at the fastest rate in nearly four decades, putting pressure on personal finances.
Households are under a lot of pressure because prices have been rising every year since April last year.
This has resulted in annual inflation of 5 percent or more.
ed every month since last October.
Energy and fuel costs continue to rise.
Last year, electricity prices rose 41 percent, while gas prices rose more than 57 percent.
Heating oil has more than doubled in price by 115 percent in the last year.
The cost of driving has also risen sharply.
Gasoline prices are up 44 percent, with diesel prices at the pump up 51 percent.
Airfares have risen an average of 38.4 percent since June last year.
CSO statistician Anthony Dawson spoke of a glitch
of prices showed that in
In May this year, diesel cost €1.93 per litre, around 56.5 liters more than in May last year.
Petrol was €1.86/l
up May 38.3c
year and the same month of the previous year.
The national average price of bread – an 800g pan with white slices – rose 13.9 cents in the year to May.
A brown-sliced pan of the same size rose 16.1 cents this year.
The price per 500 g of spaghetti increased by 18.3 cents a year, while the average
Price for 2.5 kg of potatoes fell by 19.3 c.
https://www.independent.ie/business/personal-finance/consumers-are-facing-months-of-price-rises-as-food-costs-now-rocketing-41841255.html Consumers are facing months of price hikes as food costs are now skyrocketing