Primark has warned it will raise prices for its autumn and winter collection as costs rise for businesses around the world.

The budget fashion chain will make “selective” range hikes, having so far avoided most inflationary pressures as global exchange rates have fallen in its favour.

But AB Foods, which owns Primark and Twinings and is also a major sugar producer, said the US dollar was strengthening and inflation was soaring, which would force changes.

Managing Director George Weston said: “Inflationary pressures are such that we are unable to offset all of them with cost savings, and therefore Primark will implement selective price increases on some of the fall/winter stock. .

“However, we are committed to ensuring our price leadership and everyday affordability, especially in this environment of greater economic uncertainty.”

Millions of businesses across the UK are having to make decisions about their pricing. The cost of the energy they need to operate has skyrocketed in recent months, and the costs of the raw materials and personnel they need are also rising.

This has meant some have chosen to pass these costs on to customers, although many are cautious as this will likely discourage people from shopping with them.

However, despite the price hikes, Primark expects to see sales increase as it opens more stores, expanding its so-called retail area by 10% from the end of the 2019 financial year.

“As a result, Primark’s total second-half sales are expected to be higher than the second half of fiscal 2019, which pre-Covid,” AB Foods said.

The company added that it had seen a drop in retail sales of Twinings over the past six months compared to a year earlier, when people were drinking tea at home.

But this was compensated by the launch of new products in its range of Wellness teas.

AB Foods’ pre-tax profit rose 131% to £635million in the six months to early March, as revenue rose by a quarter to £7.9billion.

Mr Weston said: “This half year, group sales and operating profit have returned to pre-Covid levels. Our people responded well to the many challenges we faced.

“Our food businesses have once again proven their operational resilience and sugar has had another strong period, building on its recent record of recovery.

“Steps to mitigate higher costs across all of our businesses have been taken and more are planned.

“Primark has seen a significant increase in sales and profits, with stores now open and trading largely free of restrictions.”

Keith Bowman, investment analyst at Interactive Investor, said: “Overall, inflationary cost pressures are proving to be a growing headache.

“The lack of a significant online presence during the pandemic contrasts with that of apparel rival Next, as economic uncertainty and geopolitical tensions continue to warrant consideration.

“In contrast, overall group sales and operating profit have returned to pre-Covid levels.”