Food inflation climbed to 2.9% in October, up from 2.5% in September, according to the latest figures from the British Retail Consortium (BRC). With Christmas weeks away, the increase could add further pressure on households already managing weekly grocery costs.
The figures, collected between October 1 and 7, show that prices for food kept at room temperature, such as tins, packets and other cupboard essentials, are rising particularly quickly. Inflation for these products jumped to 3.2%, compared with 2.2% the previous month. Meanwhile, fresh food inflation remained unchanged at 2.6%.
Overall shop price inflation at highest level in two and a half years
It is not just groceries becoming more expensive. Overall shop price inflation rose to 2.1% in October, up from 1.4% in September, reaching its highest level in two and a half years. The BRC warned that retailers are finding it increasingly difficult to absorb rising costs, including energy bills, transport, business rates and employment expenses.
Helen Dickinson, chief executive of the BRC, said: "The dam is starting to break on the huge wave of costs retailers have absorbed over the last two years." She added: "Food inflation rose again, driven by ambient groceries, although retailers still delivered plenty of promotions on sweet treats ahead of Halloween."
Retail industry calls for action ahead of Budget
The figures were published ahead of Chancellor John Healey's Budget on October 28, with the retail industry calling for action to prevent further price rises. The BRC urged the Government to reduce employment costs and scrap a planned 3.5% increase in business rates.
Mike Watkins, head of retailer and business insight at NIQ, said growing pressure on global supply chains had made higher inflation increasingly likely. However, he explained that price cuts by food retailers since the end of summer had helped delay some of the impact. He also suggested retailers would become more reliant on promotions as shoppers grew increasingly cautious about spending.
Impact on Christmas budgets
For families preparing for Christmas, the latest figures suggest there could be less room in the budget for festive extras. While supermarkets are expected to continue offering discounts and promotions, the rise in food inflation means shoppers may find some of their usual groceries costing more than they did last year.
