Food prices have fallen for the first time in more than two years, driven by intense competition between supermarkets to bring down shopping bills.
According to data from the British Retail Consortium (BRC), grocery prices were down 0.1% month-on-month in September.
However, prices were still 9.9% higher than in September last year, though the rate of year-on-year inflation was slower than the 11.5% rise seen in August.
Subscribe to Retail Gazette for free
Sign up here to get the latest news straight into your inbox each morning
The decline was driven by fresh food inflation, which fell to 9.6% in September from 11.6% in August, its lowest level in 14 months.
The drop came as overall shop price inflation slowed to 6.2% year-on-year from 6.9%, the lowest reading since September 2022.
Amid the current cost of living, supermarkets have been engaged in price wars, vying to attract and retain customers through a range of discounts, promotions and loyalty programs to entice shoppers.
Consumers who bought dairy, margarine, fish and vegetables would have seen lower prices than in August, while households had also benefited from cheaper school uniforms and other classroom supplies.
BRC chief executive Helen Dickinson said: “We expect shop price inflation to continue to fall over the rest of the year. However there are still many risks to this trend – high interest rates, climbing oil prices, global shortages of sugar, as well as the supply chain disruption from the war in Ukraine.”
“Retailers will continue to do all they can to support their customers and bring prices down, especially as households face being squeezed by higher energy and mortgage bills.”
Click here to sign up to Retail Gazette‘s free daily email newsletter
