Food price inflation has slowed to its lowest level this year as prices of staples including oils, fish, and breakfast cereals fall.
According to the British Retail Consortium and NielsenIQ retail analysts, food inflation slowed to 13.4% in July, from 14.6% in June – the lowest level since December 2022.
BRC chief Helen Dickinson said the figures were “cause for optimism” but warned of supply chain issues ahead.
Russia’s withdrawal from the Black Sea Grain Initiative and targeting of grain facilities, as well as rice export restrictions from India, were “dark clouds on the horizon”, she said.
“We expect some global commodity prices to rise again as a result, and food prices will be slower to fall.”
Subscribe to Retail Gazette for free
Sign up here to get the latest news straight into your inbox each morning
Mike Watkins, head of retailer and business insight at NielsenIQ, said: “Shoppers continue to change how they shop as part of their coping strategies. This includes shopping at different retailers, buying lower priced items, delaying spend or only buying when there are promotions.”
This marks the third month in a row that the pace of food price rises has fallen, following rates of 15.4% in May and 14.6% in June.
Overall, the research found that annual shop price inflation eased to 7.6% in July – the lowest rate this year – down from 8.4% in June.
Compared with June, prices fell by 0.1% for the first time in two years.
Non-food inflation decreased to 4.7% in July, down from 5.4% in June, largely because of reductions in the price of clothes and footwear.
Click here to sign up to Retail Gazette‘s free daily email newsletter
