Bank of England governor Andrew Bailey has flagged the potential for “apocalyptic” food price rises fuelled by factors such as Russia’s invasion of Ukraine.

Ukrainian flag and wheat

War in Ukraine is likely to result in higher prices of products such as wheat

Bailey, speaking as consumers already face rocketing inflation of energy prices and higher food costs, told MPs that prices of wheat and cooking oil could be affected. 

He told the Treasury Select Committee yesterday: “There’s a lot of uncertainty around this situation. That is a major, major worry and it’s not just I have to tell you a major worry for this country, there’s a major worry for the developing world as well. Sorry for being apocalyptic for a moment, but that is a major concern.”

Inflation has risen to its highest level in three decades and is expected to climb to as high as 10% in the autumn. 

Pressure on disposable spending power was also evident in new ONS data, released this morning, which showed that wages, adjusted for inflation, slid by 1.2% in the first quarter of the year. That was the biggest decline since 2013.

However, the data also showed that unemployment is at a 50-year low and job vacancies are at a high.