Shop price inflation slowed to 0.9% in July, offering relief for households, though retailers cautioned that cost pressures are building on the horizon.
The figure marks a decline from June's 1.2%, according to British Retail Consortium (BRC)-NIQ data. Non-food inflation eased to 0.2% from 0.6%, while food price inflation edged down to 2.2% from 2.4%. However, fresh food inflation rose to 3.1% from 2.8% in June.
Summer discounts and sector trends
Shoppers benefited from deals on snacks and alcoholic drinks during the football World Cup. Clothing and footwear retailers offered significant discounts as they began clearing summer stock. In contrast, categories such as electricals and health and beauty saw higher inflation, driven by rising chip prices and manufacturing costs.
Industry warnings
Helen Dickinson, chief executive of the BRC, said: “Good news for households in July as shop price inflation slowed. Retailers competed hard to limit prices rises, with a wave of summer promotions across food and other goods. While today’s figures are encouraging, growing cost pressures remain on the horizon. Higher employment costs and packaging taxes, global instability and climate-related disruption all make it more expensive to get products onto shelves.”
Mike Watkins, head of retailer and business insight at NIQ, added: “Shop price inflation remains lower than a year ago, which will help shoppers as they manage other increases in household spend, such as energy and fuel. So, we can expect promotions to continue to be an important part of driving demand for the rest of the summer.”
