Bank of England says inflation will fall but company bosses warn ‘shoppers will still pay high prices’

THE BANK OF ENGLAND yesterday promised that inflation would come down this year but company bosses warned shoppers would still suffer higher prices.

Governor Andrew Bailey told the Treasury select committee that inflation was “guaranteed” to fall by the end of this year unless there was another major unexpected global shock.

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Mr Bailey noted that there were “powerful downward forces” such as falling shipping, energy and commodity prices which should knock consumer price inflation down from 10.5 per cent to four per cent by the end of this year.

However, the boss of Unilever — maker of Marmite, Hellmann’s and Ben & Jerry’s — said that while we were at “peak inflation, we are not at peak prices”.

The consumer goods giant has already raised prices of its brands by 13 per cent but warned its products would become even more expensive.

Despite Unilever hiking prices faster than rivals at Nestle and Procter & Gamble, boss Alan Jope said that it was absorbing billions of extra costs.

He said: “We believe we are sharing the pain.”

The firm’s profits still increased by 14.5 per cent to £7.3billion.

Dairy firm Arla warned the cost of producing a litre of milk had shot up 66 per cent to 45p.

Arla’s UK sales grew by 17.5 per cent last year to £2.6billion.

Meanwhile, telecoms watchdog Ofcom said it would review how companies put up prices.

Sky plans to raise the cost of broadband by £67 a year.

The regulator is concerned many customers did not understand bills were linked to inflation.

Still selling ices to Russia

THE boss of Unilever yesterday tried to defend selling Magnums and Cornetto ice creams in Russia.

The consumer goods giant is still contributing £580million a year or £1.6million a day to the warmongering country, according to analysis by the Moral Rating Agency.

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Unilever chief Alan Jope said staying in the country but cutting imports, marketing and investment was the option that “contributes the least to Russian economy”.

He added that the firm was managing its business so factories and assets “don’t fall into the hands of the regime. We are not trying to protect the commercial value of our business in Russia”.

Leon cheap eat

LEON has become the latest food chain to launch a budget meal deal.

The outlets will sell a £3.99 hot BBQ chicken or black bean chilli rice pot with a drink from next week.

Leon follows rival Pret which launched £2.99 sandwiches and a meal deal.

Food inflation has hit record levels leading to restaurants and cafés increasing the price of takeaways.

Bank’s big loss

CREDIT SUISSE has suffered its biggest annual loss since the financial crisis.

Shares in the Swiss bank fell by 12 per cent yesterday after it posted a £6.5billion loss on the back of investors pulling their money out.

There were more than £98billion of outflows from its rich client base in the last four months of the year.

Credit Suisse has been hit by scandals including the collapse of a US investment firm, its involvement in bust British finance firm Greensill and cocaine cash laundering.

THE UK needs a million more builders over the next decade as a huge skills shortage bites.

A third of the construction workforce will retire in that time and 244,000 qualified apprentices are required to plug the gap, jobs directory Checkatrade said.

Move over tax

THE boss of AstraZeneca has blamed “discouraging” taxes for building a new £296million drug factory outside the UK.

Sir Pascal Soriot said the firm chose Ireland over the north of England “because the tax rate was not supportive”.

Pharmaceutical firms want the Government to overhaul a drug sales tax which will increase a levy from £563million to £3.3billion this year.

Mr Soriot said the industry should not be made to “pay for the explosion of cost coming from Covid”.

Deliveroo axes one in 10 job

DELIVEROO is cutting almost one in ten jobs as the takeaway app joins the growing list of tech firms to suffer as online growth slows.

Founder and boss Will Shu said the business would axe about 350 jobs — nine per cent of its workforce.

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“It pains me that we have to do it,” he said.

He admitted that he increased the workforce too quickly while sales boomed during the pandemic but the growth didn’t last.

He said: “We now face unforeseen economic headwinds. I will not be making the same mistakes.”

Tech giants Facebook, Amazon, Twitter, Google, Dell and Microsoft have also slashed jobs.

Mr Shu said that record high inflation, interest rates, energy crisis and recession fears were now erasing the tailwinds Deliveroo benefitted from during lockdowns.

It has since pulled out of several markets and will focus on profits.

Jobs up in smoke

CIGARETTE-maker British American Tobacco has warned it will have to cut 3,000 jobs as it overhauls the business to focus on vapes.

The producer of Dunhill and Rothmans said there would be a “few thousand” redundancies in its traditional businesses as it aims to double vape sales to £5billion in the next three years.

BAT expects tobacco sales to fall by two per cent this year as people shift to e-cigarettes.