// Shop prices rose at their fastest rate in over a decade last month, new figures reveal
// Food inflation remained unchanged at 2.7 per cent in February, the highest rate since September 2013
Retail price annual inflation accelerated to 1.8% in February, up from 1.5% in January – the highest rate of inflation since November 2011, according to the British Retail Consortium (BRC) and NielsenIQ.
Rapidly rising food prices, particularly for fresh food remained the key driver behind inflated prices.
However, increased health, beauty, and furniture prices also contributed to the inflationary increase from January, with non-food inflation rising from 0.9% in January to 1.3% in February, its highest rate since September 2011.
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Food inflation remained unchanged at 2.7% in February, the highest rate since September 2013. This remained above the 12-month average price growth rate of 0.7%, as well as the six-month growth rate of 1.6%. This rate is now the highest inflation rate recorded since September 2013.
“Food inflation remained the key driver behind higher prices, particularly for fresh food which has been impacted by poor harvests, both in the UK and globally,” the BRC’s Helen Dickinson added.
“Meanwhile, the increase from last month is a result of rising prices for non-food products, particularly health, beauty and furniture. There is little sign of change, with the Bank of England predicting price rises to continue until at least the spring.”
“Price rises will be unwelcome news for households who already face falling disposable income because of the rise in national insurance and energy price caps. Retailers continue to face cost pressures from higher shipping rates, with crude oil prices having almost doubled over the last year. Other pressures include labour shortages, commodity price increases, and rising energy prices.”
It follows yesterday’s news that shoppers have started to flock to discount retailers in a bid to cut down on grocery costs. Aldi and Lidl were the fastest growing retailers in the three months to 20 February, both increasing sales 3.3%, Kantar data revealed.
NielsenIQ head of retailer and business insight Mike Watkins said: “Inflation has increased since the start of the year and the underlying trend in shop prices will be upwards over the next few months. With falling disposable income for most households, retailers will need to keep encouraging customers to spend by offering choice and value and, for some, discounts as well as added benefits for loyal shoppers.”
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