Food inflation decelerated to 6.1% in January, down from 6.7% in December, the lowest since June 2022.
The latest BRC- Shop Price Index reveals that fresh food inflation slowed to 4.9% in January, down from 5.4% in December, the lowest since May 2022.
In addition, ambient food inflation decelerated to 7.7% in January, down from 8.4% in December – the lowest since July 2022.
Mike Watkins, Head of Retailer and Business Insight at NielsenIQ, said: “Shoppers are seeing savings at the checkout with non-food retailers on promotion and food retailers continuing to reduce prices when the costs of goods fall. However, consumer demand remains fragile as most households are yet to feel better off after nearly 2 years of inflation.”
Overall shop price annual inflation eased to 2.9% in January, down from 4.3% in December. This is below the three-month average rate of 3.9%.
Helen Dickinson, Chief Executive of the British Retail Consortium, said: “Good news for the morning brew as the price of tea and milk fell, while evening tipples remained more expensive on the back of increased alcohol duties.
“Retailers have spent the last eight months working to bring down inflation, but progress will likely be hampered by new cost pressures coming direct from government – including implementing the increase in the National Living Wage on top of an above inflation rise in business rates this April, a potential new grocer ‘surtax’ in Scotland, and ill-conceived recycling proposals. Rising geopolitical tensions will also add to uncertainty and costs in supply chains.”
