Families struggling even as food inflation slows

Grocery price inflation has slowed to 4.5 per cent, its lowest level for two years, but almost one in four UK households say they are still struggling financially, according to latest figures.

Supermarket prices were 4.5 per cent higher than a year ago in March, the lowest inflation rate since February 2022 and a significant drop from last month’s 5.3 per cent, analysts Kantar said.

Prices are rising fastest in markets such as sugar confectionery, chocolate confectionery and vitamins and supplements, and are falling fastest in butter, milk and toilet tissue, it said.

Despite the continued slowdown, 23 per cent of households continue to identify themselves as struggling financially – the same proportion as last November, according to the survey of more than 10,700 people at the end of January.

“Grocery inflation has come down significantly since hitting an eye-watering peak of 17 per cent in March 2023,” Fraser McKevitt, Kantar’s head of retail and consumer insight, said.

“However, despite this continued slowdown, many British households are still feeling the squeeze; 23 per cent identified themselves as struggling financially in our data – the same proportion as reported in November last year.”

Of those, 78 per cent are buying cheaper groceries while 68 per cent are using promotions to help manage budgets, with £605m more spent on deals this month than in March last year.

Kantar said an early Easter boosted sales of seasonal treats in the first quarter this year by £88m compared with the same period last year.

Mr McKevitt said: “Consumers have been stocking up on classic seasonal treats, with a quarter of people picking up four or more items when buying chocolate eggs.” Kantar said online supermarket Ocado was the fastest-growing UK grocer over the 12 weeks to 17 March, with sales up 9.5 per cent year-onyear, benefiting from a sustained voucher campaign which helped it attract customers.

Tesco was the market leader followed by Sainsbury’s – with sales increasing by 5.8 per cent and 6.7 per cent, respectively.

Third-placed Asda’s sales were up 0.2 per cent, while Morrisons’ rose 3.6 per cent. Sales at discounters Aldi and Lidl grew by 3.1 per cent and 8.8 per cent, respectively.

Sales of branded goods pushed ahead of ownlabel products in March but premium own-label lines grew by 16.1 per cent, the quickest in almost three years, Kantar said.