A top economist has warned that Irish inflation could top 10% in the coming months as the cost of living soars.
The latest Dublin Economic Monitor published earlier this month showed that "leading indicators for the Capital’s economy hint that a recession is an increasingly realistic possibility".
The cost of food is expected to continue to rise, with new CSO figures showing that Ireland has the second most expensive food prizes in the Eurozone, a whopping 17% above the average.
Read more: Dublin house prices continuing to spike in latest report
Economist Jim Power spoke on Eamon Dunphy's 'The Stand' podcast and warned that food prices most likely won't be coming down anytime soon.
He said: "I think for reasons of food more than anything else, the inflation rate in this country could easily hit and top 10% in the coming months because I just don't see any of those forces driving food prices improving anytime soon. Obviously a lot depends on what happens in Ukraine but from what we can see at the moment that situation doesn't look to be resolving itself anytime soon.
"Here in Ireland in the year to May, food price inflation was running at 4.5%. That seems pretty tame relative to the headline rate of 7.8% which is primarily driven by various energy costs.
"Within that 4.5%, it is the highest rate of food price inflation that we have seen in at least a couple of decades. Bread is up 8.8%, flour is up 12.1%, meat is up 7.5% and based on what we understand about global forces and particularly important costs like energy, fertiliser and indeed labour costs, it is hard to reach any other conclusion than that food price inflation is really going to become a thing in this country and elsewhere over the coming months.
"The United Nations has warned that 800 million people globally could be seriously, seriously vulnerable to serious food shocks over the next 12 months."
Mr Power said that vulnerable countries are forking out "significantly more for less food". He said: "The UN analysis makes it very clear that more vulnerable countries are paying significantly more for their food imports but they're actually receiving less food.
Read more: When will the next financial crisis hit and how long will it last?
"Typically those countries have growing populations so the demand for the volume of food being consumed should be increasing but it is actually declining because of the price. So that does spell huge, huge problems for those vulnerable countries.
"In many senses, what we are experiencing in Europe, the United Kingdom, Ireland, it's pretty tame compared to real problems like that.
"But nevertheless, we saw it this weekend with the cost of living protest happening across the country. Clearly a lot of people are feeling a serious squeeze in this country at the moment. But, relative to those vulnerable countries, what we're experiencing is pretty tame stuff."
Read next:
Fuel rationing 'could be a reality' very soon, warns EU Commissioner
Varadkar can't 'definitively rule out' emergency budget to tackle fuel crisis
Dublin taxi driver calls on Government to meet drivers over lack of cabs
Social welfare payments available to help with gas and electricity bills
Minister for Finance Paschal Donohoe warns of recession risk
Sign up to the Dublin Live Newsletter to get all the latest Dublin news straight to your inbox
