UK grocery price inflation sees biggest drop since March 2023 peak
'It is clear that shoppers have dramatically changed their behaviour to combat inflation,' said Fraser McKevitt, head of retail and consumer insight at market researcher Kantar
Food price growth fell 1.6 percentage points to 14.9% in the four weeks to 9 July 2023, according to the latest data from Kantar. Grocery sales over the same period grew by 10.4% compared with 12 months ago.
This marks the fourth month in a row that grocery inflation has fallen, after hitting a high of 17.5% in March.
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Kantar's McKevitt said the data would be «good news for many households although, of course, the rate is still incredibly high».
The change comes as spending on promotions has gone up for the first time in two years, now accounting for just over a quarter of the total market at 25.2%. This boost to promotional spending has contributed to bringing inflation down, as retailers ramp up loyalty card deals like Tesco's Clubcard and Sainsbury's Nectar Card.
This could signal a change in focus by the grocers, according to Kantar, away from efforts on everyday low pricing like offering more value own-label lines.
Prices were also rising quickly last summer, so the latest slowdown was partially due to current figures being compared with higher rates one year ago, it added.
At the current level of inflation, households would have spent £683 more on their annual grocery bill to buy the same items as they did a year ago, but consumers have adapted their habits to limit this increase to £330.
McKevitt added: «It is clear that shoppers have dramatically changed their behaviour to combat inflation, whether by trading down to cheaper products or visiting different grocers.»
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