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The cost of some staple goods in UK supermarkets has started to drop as grocery price inflation fell for the seventh consecutive month to the lowest rate in more than a year, according to industry data.
In the four weeks to October 1, grocery prices rose by an annual rate of 11 per cent, down from 12.2 per cent the previous month and the lowest since July 2022, research company Kantar said on Tuesday.
Tom Steel, strategic insight director at Kantar, said: “For the first time since last year, the prices of some staple foods are now dropping and that’s helping to bring down the wider inflation rate.”
Last autumn, dairy registered the sharpest rise in prices of all categories. But the average cost of a 250g pack of butter is now 16 pence less than 12 months ago, according to Kantar.
The data is further confirmation that food inflation, one of the important drivers of rising prices in the UK, is beginning to fall, suggesting that cost of living pressures are beginning to ease.
Figures from the British Retail Consortium trade body this week showed that in September retail inflation fell to its lowest level for a year, with food prices declining month on month for the first time in two years.
Official data on food and non-alcoholic beverage inflation, due from the Office for National Statistics next week, is expected to underscore the decline.
Wholesale energy and food prices soared last summer following Russia’s invasion of Ukraine, which disrupted global supply chains. High food prices have hit the poorest households hardest, as they spend a larger proportion of their income on necessities.
Sue Davies, head of food policy at the consumer association Which?, said:
“Inflation easing is positive, but the reality is that supermarket prices are still rising very quickly when many shoppers are already struggling to make ends meet.”
Kantar reported that consumers continued to look for cheaper food options at the supermarket. Spending on promotions made up 26.5 per cent of sales in the past 12 weeks, the highest level since June 2022.
Cheaper supermarkets Lidl and Aldi reported annual sales growth of about 15 per cent, double the rate of the entire grocery sector, and increased their market share compared with last year.
Kantar also reported that sunny weather last month “meant the barbecues stayed out of sheds for another few weeks”, with volume sales of ice cream, burgers and dips shooting up by 27 per cent, 19 per cent and 10 per cent respectively.
Source: Economy - ft.com
