British households finally received a much-needed reprieve from the cost-of-living crunch as food inflation plummeted to its lowest point in a year and a half.
According to the latest figures from the British Retail Consortium (BRC)-NielsenIQ Shop Price Index, annual food inflation slowed significantly to 3.2% in June, down from 3.4% in May. This marks the sixteenth consecutive monthly drop and the most favourable reading since January 2023.
What's Getting Cheaper?
The report highlights a clear trend of falling prices in key areas of the supermarket. Shoppers will find the most substantial savings on:
- Butter
- Fish
- Fruit (with ample summer harvests boosting supply)
- Non-Alcoholic Beverages
These price drops are primarily driven by fierce competition between major supermarkets and a gradual easing of costs throughout the global supply chain.
A Mixed Basket: What's Still Rising?
It's not all good news, however. The cost of some essentials continues to climb, albeit at a slower pace. Prices for:
- Coffee
- Chocolate
- Potatoes
- Crisps
remain stubbornly high due to earlier poor harvests in key growing regions, which continue to affect availability and cost.
Overall Shop Price Inflation Cools
The positive trend wasn't confined to just food. Overall shop price inflation also decelerated, falling to 0.2% in June from 0.6% in May. This is the lowest level since October 2021 and is a strong indicator that the broader inflationary pressure on the high street is finally easing.
Helen Dickinson, Chief Executive of the BRC, welcomed the news but cautioned that the future remains uncertain. She pointed to looming threats such as new border checks and rising shipping costs due to global disruptions, which could potentially push prices up again in the long term.
For now, though, UK consumers can enjoy a slightly more affordable trolley of groceries and a sign that the financial squeeze may be starting to loosen.
