The United Nations has warned that world food prices are rising at the fastest rate in more than 10 years.
The organization relies in its calculations on broad indicators that include the cost of food at the global level, which has recorded a continuous increase during the last 12 months.
Global supply has been affected by disruption to production, labor and transportation due to the coronavirus pandemic.
There are fears of inflation as the high cost of food will disrupt the recovery of the global economy.
The index of the Food and Agriculture Organization of the United Nations, FAO, monitors food prices in the world, including cereals, oil and dairy products, meat and sugar.
The index showed that food prices rose by 39.7 percent in May, the largest monthly rise since October 2010.
All five components of the index rose, driven by the rise in the prices of vegetables, oil, grains and sugar, which made the index reach its highest level since September 2011.
The increased cost of food is due to renewed demand in a number of countries, and production disruptions due to the pandemic. Market turmoil due to restricted movement has led to higher prices.
Experts have warned that the high demand and the lack of production will lead to a rise in inflation, coinciding with the return of the international economic movement after the lifting of closure restrictions.
But the FAO index expects a heavy global production of cereals this year, which contributes to alleviating the price hike, and the restoration of some industries to their strength.
Last week, the British Retail Authority warned consumers that they may face higher prices for their purchases in the fall due to higher costs.
What is inflation?
Inflation is the rate of increase in the prices of goods and services.
Inflation determines the prices of purchases and services paid by the consumer, and also affects bank interest rates. ,Thus on mortgages, it also determines the prices of transportation tickets.
Inflation is a key element in measuring financial health because it determines the consumer’s ability to buy. The higher the inflation, the weaker the ability of the money we have to buy.
As for low inflation, it encourages consumers to buy, and allows companies to raise workers’ salaries, which stimulates economic growth.
Central banks in most countries of the world seek to keep the inflation rate between 2 and 2.5 percent.