Food prices fall for first time in two years

investmentweek.co.uk:

Lower grocery inflation will be welcomed by households, where budgets remain under pressure.

Grocery inflation fell by 0.1% in September, compared with a rise of 0.6% in August, according to the latest shop prices index published by the British Retail Consortium and NielsenIQ.

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This brought year-on-year food inflation down to single digits and contributed to the fifth consecutive monthly fall in the headline rate, helped by easing cost pressures

On an annual basis, grocery prices jumped by 9.9%, the weakest pace of growth since August 2022. This compared with last August's figure of 11.5%. Overall shop prices inflation dropped to 6.2% annually, from 6.9%.

Customers who bought dairy, margarine, fish and vegetables — all typically own-brand lines — will have found lower prices compared to last month, according to the research.

Households also benefited from price cuts for school uniforms and other back-to-school essentials

The BRC expects shop price inflation to continue to fall over the rest of the year.

However, Helen Dickinson, chief executive of the BRC, said «there are still many risks to this trend», including high interest rates, climbing oil prices, global shortages of sugar, as well as the supply chain disruption from the war in Ukraine. 

Lower grocery inflation will be welcomed by households, where budgets remain under pressure.

UK business leaders forecast inflation to fall over next 12 months

More than half of households are still feeling they are «significantly impacted» by the continued increases in cost of living, according to the NielsenIQ Mid-Year Consumer Outlook. 

Mike Watkins, head of retailer and business Insight at