Supermarket prices 'will rise at least 5 per cent next year as a result of Brexit'

Justin King, former CEO of Sainsbury's, said the decline in the value of the pound will make it difficult for retailers to calm price hikes

(Rex)

Supermarket shoppers will be hit by price rises of at least 5 per cent over the next year, the former head of Sainsbury's has warned.

Justin King blamed the plunge in the value of the pound since Brexit for creating a “profound change” for food retailers.

Mr King said supermarkets would find it hard to calm price hikes while dealing with increased costs.

He told BBC Newsnight: “Something of around 40 per cent to 50 per cent of what we buy in the shops is sourced abroad in a currency other than the pound, and with the current rates of exchange we could expect that to be about 10 per cent more expensive in a year's time. And if that's about half of what we buy, that means something of the order of 5 per cent inflation.”

The view was supported by the director-general of the Food and Drink Federation, Ian Wright, who told the BBC prices could increase next year by between 5 per cent and 8 per cent.

PA