Shop price inflation accelerated to 1.4% year on year in September, up from 0.9% in August, according to the British Retail Consortium (BRC). The figure surpasses the three-month average of 1.0%, highlighting a broadening of inflationary pressures beyond the food sector.
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Non-food inflation moved into positive territory, reaching -0.1% in September compared with a decline of -0.8% in August and a three-month average of -0.6%. Food inflation remained steady at 4.2% year on year, consistent with August, while fresh food maintained 4.1% and ambient food held at 4.2%.
Helen Dickinson, Chief Executive of the BRC, commented:
"A year and a half of non-food deflation looks set to come to an end, as inflationary pressures spread beyond food. DIY and gardening saw rising prices, while some back-to-school categories continued to see reductions as retailers offered promotions on electricals such as laptops ahead of the new academic year. Food inflation held steady after seven consecutive months of rises, but increased labour and energy costs continue to push up input prices for many farmers, particularly of cattle, with dairy and beef prices remaining high."
She added:
"Households are finding shopping increasingly expensive. The impact on retailers and their supply chain of both global factors and higher national insurance and wage costs is playing out in prices for consumers. The new packaging tax, set to take effect in October, will put further upward pressure on inflation. While retailers continue to absorb higher costs as much as possible and deliver value to customers, any further tax rises in the upcoming Budget would keep shop prices higher for longer. Ultimately, it is British households who will bear the consequences, positive or negative, of the Chancellor's decisions."
Mike Watkins, Head of Retailer and Business Insight at NIQ, noted:
"With inflationary pressures persisting, many shoppers remain concerned about their personal finances and are becoming increasingly price-sensitive. As a result, retailers are likely to continue offering promotions and deals in the coming weeks to help maintain sales momentum."
The data reflect broader economic pressures impacting UK households, including rising labour and energy costs, upcoming tax changes, and global market factors. Retailers are navigating these challenges while striving to provide value to consumers, though further inflationary pressures are expected in the near term.
More information:
British Retail Consortium (BRC)
[email protected]
www.brc.org.uk
