UK inflation has stormed ahead of the Bank of England ´s (BoE) target this year, with the consumer price index currently running at 3.1%.
The reason: last year´s Brexit induced devaluation in the pound.
If you´re sitting down for a Christmas dinner this year in the UK, it could cost 18% more than in 2016.
No wonder UK consumers are feeling under pressure when wage inflation is rising at just 2.3%.
Christmas is going to be a lot more expensive for UK consumers, who have been facing declining real wages.
Good Housekeeping magazine found the cheapest Christmas dinner for eight people would cost £25.53, sourced through budget supermarket Lidl.
This is nearly a fifth more than the same meal would have cost last Christmas.
The annual survey took into account the cost of a whole turkey, sprouts, potatoes, parsnips, carrots, a jar of cranberry sauce, stuffing mix, Christmas pudding and cake, a jar of brandy butter and mince pies.
Behind the headline price rise are sizeable increases in the costs of basic ingredients.
Official UK data shows the price of a 250g block of butter has risen by around 29% since the Brexit referendum.
As well as the higher costs associated with a weaker pound, dairy prices have also been boosted this year by a fall in UK and EU milk production.
Due to low prices for milk in 2014, many UK producers had decided to shut down.
At the same time, UK farmers have also been citing earlier poor weather for a fall in output.
With around a quarter of the UK´s milk supply produced outside the UK, the post-Brexit referendum sterling depreciation has also had a sizeable impact.
Sterling is currently 10% and 14% lower than its pre-Brexit referendum level against the dollar and euro respectively.
Official figures show the price of sugar has risen by around 15% since the referendum.
About a third of the UK´s sugar supply is imported, making the devaluation in sterling over the period a key culprit behind sugar´s rise.
The price of international US dollar sugar futures has actually modestly declined over the same period.
The price of bread, a key ingredient in your stuffing on Christmas day, has increased by just over 7% since the Brexit referendum.
With the vast majority of wheat that goes into making UK flour produced within the UK, bread is inherently less sensitive to changes in sterling compared with butter and sugar.
There are however those indirect sterling impacts that have contributed to pushing up bread prices.
Higher fuel prices push up costs for farmers, as they do for distributors. The price of Brent crude oil has risen by around 20% since the Brexit referendum in US dollar terms.
More so in pound terms, once sterling´s devaluation is factored in.
Once you´ve devoured your Christmas dinner, you may be ready for some Christmas biscuits, as you settle down to watch that movie blockbuster or even the Queen´s speech.
Research from The Grocer magazine, based on data from Brandview, points to big rises in biscuit prices.
Sterling´s devaluation, as well as the huge rise in butter prices, some of which is non-sterling related, are behind the phenomenon.
The survey found that Asda’s Christmas Milk, Dark and White Chocolate Biscuits had jumped by a third, to £4.
The good news
While higher prices are putting a bit of a dampener on the UK´s Christmas dinner this year, the good news is that UK inflation is likely to trend lower over 2018.
Next year´s Christmas dinner should at the most cost a few percent more than this one.
Over the coming months, we should see UK prices fall increasingly towards the BoE´s 2% target.
Although sterling remains well below its pre-referendum levels, it has been relatively stable during 2017.
Sterling´s fall in 2016 is the reason why UK inflation is so high at present; while currency impacts can have a very profound impact on consumer prices, especially for a country such as the UK which is a net importer of goods, such effects take time to feed through to supermarket shelves.
In the longer term, there is much debate about the impact Brexit could have on UK food prices. Potentially, a decline in EU migrant workers could see more UK food grown overseas, as UK producer prices rise.
However, certain Brexiters have argued that the UK could reduce food prices by sourcing more from outside the EU and being unshackled from the EU´s common agricultural policy.
At the moment, there are all too many uncertainties about how the UK´s trade agreements with the EU and the rest of the world will look in the years to come to know for sure.