PepsiCo (PEP) is set to increase the price of Walkers' potato chip brand in the U.K. in the wake of the pound's steep decline following the country's vote to leave the European Union in late June.
Media reports have indicated PepsiCo is asking supermarkets to pay 55 pence ($0.68) instead of 50 pence for a 32 gram bag of Walkers crisps (the U.K. version of Lay's potato chips). Walkers declined to confirm the increase when contacted by TheStreet.
"Whilst our potatoes are British, we import a number of different ingredients and materials to produce a finished packet of Walkers crisps e.g. seasonings, oil for frying and key raw materials used in our packaging film," a Walkers spokesperson said in an emailed statement.
"Fluctuating foreign exchange rates, supply pressure on key ingredients and the weakened value of the Pound are impacting the import cost of some of our materials and affecting the price of material costs based on commodities that are traded in Foreign currencies," the statement said.
The spokesperson added that it was up to individual retailers to determine if any price increases will be passed on to consumers.
The move the latest in a series of price hikes that are set to hit British shoppers as inflation accelerates in the months ahead.
The pound is still hovering at 31-year lows, having fallen 19% since the June 23 vote. In last week's quarterly Inflation Report, the Bank of England predicted that inflation would likely accelerate faster than it had estimated and now sees consumer prices rising at 2.7% pace for each of the next two years, up from previous forecasts of 2.0% and 2.4%.